Gold's bear market is not over yet, despite its recent rise off of a two-year low, because investor sentiment is running against it and so is the market cycle, according to Elliott Wave International's chief market analyst Steve Hochberg.

The Elliott Wave principle is a form of technical analysis that measures extremes in investor psychology, and Hochberg said the extreme low has not yet been reached in the precious metal.

"Gold is a classic example of why you can't use fundamentals to judge a market," he told Yahoo. "Gold is a classic example of a market that moves based on crowd psychology."

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Hochberg noted that a big bull market a gold from 1999 to 2011 took it to an all-time high of $1,921 per ounce, but predicted those days are over for now.

"We're two years into [gold's] bear market," he stated.

"We are in the process now of correcting the entire move from the 1999 low," he maintained. "Gold is setting itself up for another big leg down."

Hochberg told Yahoo it would be unsurprising, based on Elliott Wave analysis, to see gold sink below $1,000 per ounce during the next year or two, from its current price of about $1,309.

As for the U.S. dollar, which often moves in the opposite direction of gold prices, Hochberg was more optimistic. "In a deflationary environment, the dollar should do well. The reason is because there's so much debt denominated in dollars and people need dollars to pay their debts. The dollar will do well in the future," he predicted.

Jens Nordvig, a foreign exchange strategist at Nomura Securities, told CNBC he also thinks the dollar's drift downward is nearing an end.

"We're in the middle of what I would call final capitulation. People have been trying to get long dollar and it hasn't been working, and now people are really giving up."

Speculation the Federal Reserve could commence trimming its $85 billion monthly bond-buying regime as soon as September has been weighing on the price of gold, Reuters reported.

"Clearly the [gold] market has been reacting to currency movements and U.S. Treasury yields, the two external factors that are dictating prices at the moment," Credit Suisse analyst Karim Cherif told Reuters.

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