I heard a report that the bullish sentiment has been high for a number of days now. I found a report by Mark Hulbert that says the previous four Gold tops at bullish sentiments of around 57 to 65 percent with a subsequent drop in prices of up to 24.8 percent. Currently, the sentiment number is 68 percent (note that it is above the recent highs).
Obviously, any market can remain overbought for extended periods of time, but usually not for very long. Remember that when a lot of people are already bullish, the contrarian view is that there isn't much money on the sidelines left to drive up prices and thus, prices will fall. Looking at gold charts, a short-term correction would take it to just above $1,000 per ounce. This would make it about a 10 percent drop.
Click here for the Mark Hulbert article
Posts
No comments:
Post a Comment