One irony about financial markets is that rallies tend to start when sentiment is bearish.
That was the case with gold back in September and early October of last year, as reflected by these headlines:
- Why Hasn’t the Gold Price Fallen Further? (Bloomberg, Sept. 27)
- How Low Can Gold Go? (YouTube, Oct. 5)
Oct. 6, the precious metal hit an intraday low of $1810.35 and on that date, our U.S. Short Term Update said:
Trader sentiment is bearish and prices are setting up for a rally.
How true that turned out to be.
The first leg of the rally took the price of gold to $2135.40 by Dec. 4. That was nearly an 18% increase from that Oct. 6 low.
As we know, no market goes straight up or down. Gold declined into mid-December and struggled in January and February.
In early March, negative opinions about gold were popping up:
- Why Gold No Longer Shines As A Long-Term Investment (Seeking Alpha, March 5)
- Goodbye, Gold Price Rally – Here’s What’s Next (investing.com, March 12)
However, once again, our independent analysis went against the prevailing sentiment when our March Elliott Wave Financial Forecast noted:
The progressing wave structure indicates that gold’s larger rally has more to go.
Gold’s rally did continue. By April 12, the yellow metal hit an intraday extreme of $2431.03. Then, after another pullback, gold dusted itself off and climbed even higher, reaching $2450.30 on May 20 – a more than 35% advance since that Oct. 6 low.
Now that gold is trading somewhat lower, the question now becomes: What’s next?
Our flagship Financial Forecast Service, which includes our thrice weekly U.S. Short Term Update, keeps you posted on our latest analysis.
Learn more by following the link below.
See How Gold’s Elliott Wave Pattern Foretold Big Rally (Video)
Gold climbs in the face of bearish sentiment – as it “should”
Ironically, rallies in financial markets tend to start when sentiment is bearish. Such was the case with gold when the price of the precious metal hit a low back in October. Here’s what happened after our forecasts went against the prevailing sentiment.
U.S. Short Term Update: What You Get
Our U.S. Short Term Update publishes three times a week (Monday, Wednesday and Friday).
Yes, that means you can stay on top of near-term trends in major U.S. financial markets – like the main stock indexes, bonds, gold, silver, the U.S. Dollar and more.
Yes, you’ll see meticulously labeled daily range Elliott wave charts. Yet, you’ll also often find eye-opening charts in the 360-minute, 240-minute, 120-minute, hourly and even shorter ranges.
Our U.S. Short Term Update is part of our flagship Financial Forecast Service.
See what you’ve been missing by following the link below.