Gold investors have had to endure quite a lot in the last six months. Not only has the gold price barely moved from six months ago, but it has endured an up, down, up, down chopping motion during this period of volatility. Buffett’s now regular wise cracks. We read last week that sentiment indicators for gold investors were relatively very low. Apparently, fewer investors believed in gold than at any time during 2009 and 2010. Jason Goepfert, of SentimenTrader, found that gold was less popular with investors now than at all other times since the Credit Crunch, apart from late 2008, and a short moment at the end of 2011. Mr Goepfert tells us that gold was also equally as unpopular on two occasions in 2011.
Sentiment in gold is very low
What is interesting about these bearish sentiment levels in gold, is that often they are preparation for a bullish move. Dr. Steve Sjuggerud reminds us how these sentiment levels have rewarded investors in the past:
Back in late 2008, gold was more hated than it is today. What happened next? Gold rocketed from $750 an ounce to $1,000 in three months.
Gold was also MUCH more hated than it is today for a brief moment a couple months ago – at the end of 2011. And once again, gold soared a couple hundred dollars, trough to peak, in a couple months.
Gold was EQUALLY as hated as it is today twice in 2011: at the end of the second quarter and at the end of the third quarter. In both cases, gold managed to soar by a couple hundred dollars, trough to peak.
Gold was NOT QUITE as hated – but still hated – around the end of the first quarter and second quarter of 2010. Once again, gold did well, rising a couple…
