Submitted by Stewart Thomson
Gold has risen above HSR (horizontal support & resistance) at $1675, and did so while bursting above a key short term trend line. The arrival of the gold price at key HSR, in the $1630-$1650 area, was accompanied by rampant bearishness amongst most gold investors. The Hulbert sentiment index for gold is currently at one of the lowest points in the history of the index.
The general sentiment for gold still appears to be very negative. That’s great news for gold, because markets tend to rise strongly, on the biggest walls of worry!
Most gold timers that I keep an eye on, are still looking to short rallies, rather than buy declines. I think they are making a serious technical error with this strategy. Gold is the lowest risk asset in the world. It’s arguably the “ultimate asset”. There are not many really good shorting opportunities in a gold bull market.