The Gold Entry price
Entry price asks two simple questions. First, is gold trading above or below its own recent trend? Second, after accounting for inflation, is gold expensive or cheap compared with its long-run average? Buying above trend and near an inflation-adjusted top has historically been the worst way to start a multi-year position.
- Weight
- 20%
- Effective weight
- 22.2%
- Source
- World Bank Pink Sheet (CC BY 4.0)
- Frequency
- monthly
- Latest date
- 2026-07-31
- Latest value
- 4073 USD/toz (WB monthly)
- Staleness
- fresh (5d / limit 45d)
- Evidence grade
- strong (Moskowitz–Ooi–Pedersen momentum; Erb–Harvey valuation)
Entry price asks two simple questions. First, is gold trading above or below its own recent trend? Second, after accounting for inflation, is gold expensive or cheap compared with its long-run average? Buying above trend and near an inflation-adjusted top has historically been the worst way to start a multi-year position.
What it measures
A blend of two sub-signals published separately. Trend: deviation from the 12-month moving average plus the 12-month return. Valuation: the inflation-adjusted (CPI-deflated) real gold price ranked in its own long-run history.
Why it moves gold
Momentum has a small but persistent forward tendency in gold and other assets (Moskowitz, Ooi, and Pedersen; Hurst, Ooi, and Pedersen). Real-price mean reversion is the "golden constant" thesis of Erb and Harvey: the real gold price wanders around a long-run level and does not compound.
Today's reading
Today the entry-price pillar reads 24/100, below the historical median.
Sub-signal breakdown
| Sub-signal | Sub-score | Details |
|---|---|---|
| trend | 47/100 | dev_vs_12m_ma_pct: -2.54, return_12m_pct: 25.78, spot_used_usd_toz: 4201.19 |
| valuation | 1/100 | real_price_percentile: 99.18 |
How it is scored
Trend and valuation are computed as separate percentile ranks in their own histories, then combined into the pillar sub-score. Valuation is oriented so that a low real price maps to a high sub-score; trend is oriented so that a deeply-below-trend read maps to a high sub-score.
Orientation. Real price at the bottom of its long-run distribution, and price below its 12-month trend, both push the sub-score higher.
Evidence
- Momentum in gold and other assets: Moskowitz, Ooi, and Pedersen (2012, Journal of Financial Economics) and the follow-up Hurst, Ooi, and Pedersen (2017). Gold enters the universe from December 1969; results are pooled across asset classes with the caveats reported by the authors.
- Valuation: Erb and Harvey, "Gold, the Golden Constant, and Deja Vu" (2020) and the earlier "The Golden Constant" work. Real price above its long-run average has historically preceded below-average subsequent real returns at multi-year horizons.
- Faber (2007) shows that a 10-month moving-average rule reduces drawdowns at the portfolio level. There is no gold-only 200-day-moving-average backtest published in peer-reviewed literature, and this site does not claim one.
Caveat
Evidence grade: strong on both sub-signals, at different horizons. Trend is a near-term signal; valuation is a multi-year signal. They can point in opposite directions in the same month, and the pillar reports the blend without hiding that tension.
Seller-side note
The valuation sub-signal inverts cleanly for sellers: the real price at the top of its long-run distribution is precisely the condition under which historical forward real returns were weakest. Trend inverts too: selling into positive 12-month trend has historically been a better price than selling into weakness.
Source: World Bank Pink Sheet (CC BY 4.0) for the historical monthly price; US Bureau of Labor Statistics (CPI-U CUSR0000SA0) for the inflation deflator. See the methodology page for the composite formula and the provenance page for the per-source status board.