After last week’s surge in the metals sent the prices of gold and silver to new recent highs, SentimenTrader just issued an extremely important update on the gold and silver markets.
From Jason Goepfert at SentimenTrader: “The thrust in gold and gold stocks over the past three months has met the conditions of the studies and indicators that we discussed last fall, particularly last November.
By mid-March, several indicators were suggesting shorter-term extreme optimism and the metals backed off a bit. Since then they have surged again, particularly the mining stocks. A concern remains “smart money” hedger positions which are at or near multi-year extreme bets against the metals.
Gold and silver have consistently pulled back when hedgers have been extremely short but so far they are holding tough. This is exactly the kind of activity we have been watching since November to suggest a longer-term bull market is underway and so far these markets are following through well.
It’s hard to jump in now with hedgers betting so heavily against them but we won’t be reducing positions in mining stocks unless they fall back below their April low.”
King World News note: I would just add to what Jason has said by noting that sentiment for silver has not yet reached the level of “Excessive Optimism” (see 25-year silver sentiment chart below).
King World News note: It is also important to note that sentiment for gold has also not yet reached the level of “Excessive Optimism” (see 25-year gold sentiment chart below).
King World News note: If you look closely at the chart above, the Gold Optix spent a significant amount of time in the “Excessive Optimism” levels during the bullish advance from 2001 – 2011. Yet at the beginning of this cyclical bullish phase of the secular bull market in gold, sentiment still remains somewhat subdued. But that’s what bull markets do, they “climb a wall of worry.”
It would appear that the endless talk about the massive commercial short positions in both metals coupled with the bullish advance coming on the heels of a brutal 5-year cyclical bear market is keeping a healthy level of “fear” in the early stages of the newest leg of the bullish advance. So it will be very interesting to see how gold and silver trade from current levels in the days and weeks ahead. ***The remarkable KWN audio interview where 50-year veteran John Embry discusses what’s next for the gold and silver markets has now been released and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.
***The last time legend Rob Arnott was interviewed on KWN he recommended a specific fund to the global listeners, including the ticker symbol. In less than 3 months that fund has returned more than a staggering 26 percent! Arnott again gave specific recommendations for the global listeners and he also discussed the coming inflationary carnage that is in front of us. To hear his latest recommendations you can listen to his powerful audio interview by CLICKING HERE OR ON THE IMAGE BELOW.
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