truthingold.blogspot.com / Thursday, April 12, 2012
IMF: Gold Is Scarce “Safe Asset” And “Rising Demand for Safe Assets”…”In the future there will be rising demand for safe assets, but fewer of them will be available, increasing the price for safety in global markets.” - quote sourced from www.goldcore.com LINK
Well, there ya go. In fact, that quote ties into the subject of my title, but first I wanted to comment on potential for the bottom of this vicious precious metals correction that began in late April last year. The sentiment indicators are at rock bottom. I can say from some of the comments that have been posted on my blog over the past few weeks that even some pretty long time gold bulls have thrown in the towel on the mining stocks. Usually this type of sentiment marks the bottom of the next big move higher.
Also, Dennis Gartman, who happens to be singularly one of the best contrarian indicators of the gold market – and this fact has been close 100% consistent over the last seven years that I’ve been aware of Gartman mentioning gold in his newsletter – declared the end of the gold bull market about a week ago. Gold is up 5% since he advised his readers to dump gold. This so reminds of late 2005, when gold had a very difficult time breaking through $500. Gartman sold everything. Gold then proceeded to make a huge run up to $1000 before the next nasty correction. Gartman missed most of it.
That chart reveals the golden truth. Gold has now corrected and consolidated into a seriously bullish technical formation. Given that the fundamental backdrop – all of the factors constantly discussed on this blog – is significantly stronger than at the end of the last two nasty corrections, per the red circles above, the next move up in the metals/miners could be breathtaking.