Tags: Hulbert | gold | drop | bottom

Hulbert: Gold Hasn't Hit Bottom Yet

By    |   Wednesday, 02 Apr 2014 08:25 PM

Gold has dropped 7 percent since hitting a six-month high March 14, leading some market participants to speculate it may be nearing a bottom. 

But Mark Hulbert, founder of Hulbert Financial Digest, doesn't see it that way. 

"Some readers have contacted me to ask if enough gold timers have finally thrown in the towel to persuade contrarian analysts that a low is at hand," he wrote on MarketWatch. "No."

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While the average newsletter editor who market-times gold is more bearish today than last weekend, "he still is not as pessimistic about gold’s prospects as he was on the occasion of past tradable bottoms," Hulbert wrote.

 

Hulbert judges gold sentiment using his eponymous Gold Newsletter Sentiment Index. It measures how much exposure to the metal is recommended by gold market timers tracked by the Hulbert Financial Digest.

The average now stands at minus 10 percent, meaning the average gold newsletter recommends that readers devote 10 percent of their gold allocation to going short, Hulbert says. That represents a substantial drop from last weekend's level of 16.7 percent.

But it is still higher than the level prevailing before gold's other rebounds over the last two years, Hulbert said.

June gold futures settled at $1,290.80 on the Comex Wednesday, rising 0.8 percent to break a five-day losing streak.

"People are betting on increased physical buying and bargain hunting at these levels,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates, told Bloomberg. "This may be temporary, as prices could head lower because of expectations of higher interest rates."

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Mark Hulbert, founder of Hulbert Financial Digest, doesn't go along with predictions that gold is near a bottom.
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2014-25-02
Wednesday, 02 Apr 2014 08:25 PM
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