With continued uncertainty across the globe, we are now witnessing historic, extreme action in the gold market.
From Jason Goepfert at SentimenTrader: “No reason to buy gold, either. Sellers have been persistent in “fear trade” assets, with gold bearing the brunt of it. The GLD fund has seen demand dry up so much that the number of ounces of gold it holds has declined or stagnated for 29 days. In the fund’s history, there have been 8 streaks that matched this, all but one leading to rallies…
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A historic leak in gold holdings
While stocks have been busy winning over the past month, other assets have done everything but. Among them is gold, investors in which are nearing extreme pessimism depending on the gauge.
Bloomberg has been reporting about the consecutive number of days that the GLD fund has been leaking assets. The number of ounces of gold held by GLD has now either declined or stagnated for 29 consecutive days, the most in a year.
Since the fund’s inception, there have been 8 other times that the amount of gold held in reserve has declined for this many days, shown below.
We can see that it typically occurred neared an exhaustion point. Between 1-3 months later, GLD was higher all but one time.
The past 29 days have also seen the largest liquidation out of all of them. It’s a little troubling that the only occurrence that neared the severity of what we’ve seen recently was from April 2013, the only time GLD failed to rally over the medium-term. That’s an eyebrow-raiser, but we’d still consider this to be positive for the medium-term.
The charts and commentary above are from SentimenTrader. To try a free 14-day trial of the internationally acclaimed work that Jason Goepfert produces at SentimenTrader simply CLICK HERE.
***To listen to the extraordinary KWN audio interview with whistleblower Andrew Maguire, where he discusses the gold and silver smash, what is really happening with gold demand in India and China, government plans for capital controls and much more, CLICK HERE OR ON THE IMAGE BELOW.
***ALSO JUST RELEASED: With Gold Plunging For 7 Straight Weeks, Here Is A Look At The Big Picture For Gold, Silver & The Miners CLICK HERE.
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