Headlines not as positive this week for Gold

From 7/21

Gold closes lower; loses 7.2% on the week
Gold silver decline on bullish global advice
Gold extends losses despite weak U.S. dollar
Gold Showing Weakness

When gold takes it on the chin, I remind myself of where we are in the gold cycle.

Enrico Orlandini
Dow Theory Analysis SAC

Most bull markets have three phases to them and all three phases involve accumulation:

  • The first phase is where the so-called smart money takes great pains to build a position. They do so quietly trying always not to call attention to themselves.
  • The second phase is where the institutional investors enter the market, and
  • The third stage is where the general public, your neighbor for instance, jumps on the bandwagon.

Where are we now? Well, I’ll tell you where we are not. We are still a long way from the third and what is normally the final stage . How do I know this? It’s quite simple really. Every time I travel someone sitting next to me will ask me what I do. I usually answer that I am an analyst and specialize in gold and gold stocks. No one is impressed and they don’t have a clue as to what gold stocks are all about. Back in the early 1990’s I was heavily involved in the emerging Latin markets and it got so bad that I use to tell people I was a shoe salesman when I traveled. I couldn’t mention the words “Latin stocks” without half the people on the plane surrounding my seat. We are still a very long ways away from that type of feeding frenzy.


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