Monday, March 29, 2010

Gold Confounds Last Week's Pessimism

According to Peter Brimelow, sentiment for gold was awful last week.
On Wednesday, MarketVane's Bullish Consensus for gold broke below its 2010 low to 68%, a level not seen since January 2009. The Hulbert Gold Newsletter Sentiment Indicator [HGNSI] dropped to 18%, last seen during gold's low last month.
A head-and-shoulders pattern, discussed here last week, made technical analysts such as Martin Pring bearish. Now that the pattern's been busted, thanks to gold rising and staying above $1,100, gold ended up rallying from an oversold condition. It's been quite a "relief" rally (so to speak) since last Friday.

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