Aug 16 2010 3:32PM

Gold begins its late-summer rebound right on cue.

Only about a month ago, the investing theme was one of economic rebound, with the broader North American stock markets rallying, along with energy, base metals and the more industrial precious metals.

But then sour economic data turned the tables — sending gold and silver higher, and putting downward pressure on the asset classes that are more dependent upon economic growth.

We’ll have to get used to these 180º turns in market sentiment until the economy gets some clear direction.

The bad news is that, once the picture clears up, the biggest gains will have already been handed out.

The good news is that, regardless of which direction the economy heads, gold bugs who have been following our advice should be well positioned in both base metals (a growth scenario) and precious metals (scenarios involving slow- to no-growth, and leading to more monetary easing).

Just recently, none other than Goldman Sachs came out in favor of the latter scenario, slashing their forecasts for U.S. economic growth in 2011, and predicting that persistently high unemployment rates will force the Fed into “another round of unconventional monetary easing.”

Love ’em or hate ’em, Goldman is the smartest and most connected group on the Street, and you have to respect their opinion.

In fact, Goldman’s reputation as the ultimate insider was burnished when, following its prediction of “unconventional easing,” the Fed did just that. Soon afterward, Bernanke and Co. announced that they would begin reinvesting proceeds from their maturing mortgage-backed securities into U.S. Treasury bonds -- a more-subtle form of quantitative easing that would prevent the Fed’s balance sheet from contracting.

Hmmm. Wonder where Goldman got their information from...or was it just good, old fashioned analysis?

Regardless, this latest round of quantitative easing is good for gold. In fact, recent gains represent just the latest bounces higher in the metal’s rebound from its summertime lows. As anyone can see from Kitco’s charts, the metal bottomed right in the midrange of our expected time-frame, on July 27 at $1,157.00. If this bottom holds, then it will represent the point where gold turned higher ahead of the fall buying season.

Fortunately, even though gold’s low point may be behind us, junior resource stocks have yet to respond. Traders in this market are still on vacation, mentally if not physically. So good deals, as detailed in our recent issues of Gold Newsletter, remain abundant.

For investors in physical metals, the current market also represents opportunity. Numerous studies of gold’s seasonality during this decade-old bull market show that the metal should be trading at significantly higher levels by early next year. In short, the bottom appears to be behind us, and better days lie ahead.

I urge investors to take advantage of the current buying season for gold, silver and top-quality resource stocks, while it lasts. Within the next two or three weeks, I expect the juiciest opportunities to be gone.

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Brien Lundin is the editor and publisher of Gold Newsletter, a publication that has ranked among the world’s leading precious metals and resource stock advisories since 1971. To learn more about Gold Newsletter, visit www.goldnewsletter.com.

Mr. Lundin is also the host of the famed New Orleans Investment Conference, the world’s oldest and most respected gold investment event. To learn more, visit www.neworleansconference.com.