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Goldbugs Are Getting Antsy!

  • Written by Syndicated Publisher No Comments Comments
    March 13, 2013

    Gold bulls have been suffering through the longest, but not largest, decline in gold since its latest 12-year bull market began in 2001.

    Gold has now been down for 19 months since hitting a record high in August, 2011. 

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    Gold bulls are not worried that the bull market might be over. But they are getting antsy and anxious to see something get started on the upside as can be seen in the day-to-day volatility lately.

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    Gold is spiking up this morning, up $16 an ounce at $1,594 at the moment, reportedly on bargain hunting and short-covering, with no event or particular fundamental sparking it.

    It spiked up similarly last week, then plunged back down, and is again short-term oversold beneath its 30-day m.a. (which is at $1,619 but declining).

    We will just follow our technical indicators (not shown)

    What? A Wall Street firm Is admitting seasonality is real?

    Wall Street is famous for insisting the market cannot be timed, that retail investors need to simply buy whatever Wall Street sells them and hold on through whatever comes along. Of course, that is not what they do with their own money, or for their larger clients. Nor is it what corporate insiders do with their own money.

    So there is reason for some concern that corporate insiders are selling heavily again. But the market cannot be timed by their activity, as they usually sell early while there is still enough strength to absorb their sales, and begin buying early while stocks are still falling.

    But it was interesting that in his latest notes to clients well-known Goldman Sachs Asset Management economist Jim O’Neill, currently bullish, did not mention insider selling as a concern but said, “I am not confident about what happens next as to whether all these trends [U.S. bond, equity, and currency markets] are going to continue, not least because May is now less than two months away and the infamous “Sell in May and Go Away.”

    He is right to be concerned, since following a Sell in May discipline has beaten buy & hold significantly over the long-term, and while taking only 50% of market risk.

    Actually our Seasonal Timing Strategy, which has been independently tracked and proven to beat Sell In May by a wide margin, can get its exit signal as early as mid-April.

    To read my weekend newspaper column click here:   What Investors Need To Realize After The Terrific Jobs Report!

    Subscribers to Street Smart Report: There is a new Global Markets update (Canada, South Korea, India, China, Japan, Brazil, Germany, Emerging Markets) from last evening in your secure area of the Street Smart Report website. An in-depth U.S. market, gold, bonds, update will be there for you tomorrow.

    Images: Flickr (licence attribution)

    About The Author

    Sy Harding publishes the financial website www.StreetSmartReport.com and a free daily Internet blog at www.SyHardingblog.com. In 1999 he authored Riding The Bear – How To Prosper In the Coming Bear Market. His latest book is Beat the Market the Easy Way! – Proven Seasonal Strategies Double Market’s Performance!

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