LIVE Gold Prices $  | E-Mail Subscriptions | Update GoldSeek | GoldSeek Radio 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek.com to Launch New Website
By: GoldSeek.com

Is Gold Price Action Warning Of Imminent Monetary Collapse Part 2?
By: Hubert Moolman

Gold and Silver Are Just Getting Started
By: Frank Holmes, US Funds

Silver Makes High Wave Candle at Target – Here’s What to Expect…
By: Clive Maund

Gold Blows Through Upside Resistance - The Chase Is On
By: Avi Gilburt

U.S. Mint To Reduce Gold & Silver Eagle Production Over The Next 12-18 Months
By: Steve St. Angelo, SRSrocco Report

Gold's sharp rise throws Financial Times into an erroneous sulk
By: Chris Powell, GATA

Precious Metals Update Video: Gold's unusual strength
By: Ira Epstein

Asian Metals Market Update: July-29-2020
By: Chintan Karnani, Insignia Consultants

Gold's rise is a 'mystery' because journalism always fails to pursue it
By: Chris Powell, GATA

 
Search

GoldSeek Web

 
A Contrarian Stroll Through Recent History



-- Posted Thursday, 14 March 2013 | | Disqus

By Gary Tanashian

Opening disclaimer: I am not trotting out the past to show what a great contrarian I am. Truth is, I have not come close to fully taking advantage of the bull calls last spring and summer. Given what has gone on in the precious metals, it has been all I could do to manage risk to a break even.

That out of the way, this article was posted last May when it was very hard to be a bull:

Dumb Money Sold in May and Went Away

“Led by near suicidal sentiment among the gold ‘community’, the broad markets recently embarked on a southerly course as well, culminating with ‘dumb money’ sentiment at very bearish levels in technology, energy, financials, industrials and on out to commodities. The last time sentiment was in such a compelling (contrarian) bullish structure was after the damage inflicted upon markets by last summer’s acute phase of the euro crisis.”

Flipping the above on its head today…

Led by near pervasive and still-growing bullish sentiment, the broad market is continuing upward on its course and is culminating with ‘dumb money’ sentiment and momentum being set to over bullish levels. The last time there was such consensus on the economy and the stock market may well have been in 2000.

“Think about the election year pattern, think about how wildly bearish sentiment has become, think about the market’s need to shake out the dumb money prior to rising and most of all think about how policy makers need to be perceived as doers of good; as part of a solution, as opposed to chronic purveyors of an inflationary regime that has been in force most intensely since 2000.”

Policy makers are not only thought of as part of the solution, they are revered far and wide in a reverential and growing rabid manner. This is the ultimate bull rationalization and it is the underpinning of confidence (great word) in today’s market.

In July this was written:

Dumb Money Sold in May?

“There are still articles showing up in the MSM talking about what a good idea it was to ‘sell in May and go away’. But the truth of the S&P 500 chart begs to differ. Yes, it has been a nerve wracking couple of months, but as of Friday the SPX is above where all but the most astute of the ‘sell in May’ contingent got out.”

There are now articles showing up in the MSM talking about the Great Rotation, the Dow’s all-time highs and a new era for the US economy, which has weathered the Euro crisis and myriad domestic issues as it continues to strengthen. All the talk of inflationary policy makers has gone the way of Goldilocks.

“I do not love this market by any means. But I am still long (and profitable) several positions that were bought down near the lows (Lithium, Rare Earths, a tactical global fund, a global bond fund) and others in technology and energy added since.”

Well do you remember how hard it was to be bullish last summer? Now it is easy to be bullish. Too damned easy.

“Last week as SPX tested but did not fail support at the EMA 200, I held, white knuckles and all. This market may yet prove that the dumb money sold in May; especially if the rally ends up going on long enough to drag them back in again before any coming change to bearish again.”

The dumb money is holding without a care in the world.

Another post from August:

“Dumb Money Sold in May and Went Away”

“But even if the market tanks tomorrow and stays tanked, the dumb money sold in May. Sentiment structures said so then and ‘price’ says so now. The big question is whether or not the dumb money will buy back in setting up the opposite scenario to May.”

One opposite scenario, comin’ up?

If you want a newsletter that works very hard to be right about these big macro turns, then give a Notes From the Rabbit Hole subscription a try. My personal trading can range from very good to poor. I am human. But the themes carried forward in the newsletter are usually nicely in alignment with the macro picture, from a contrarian’s point of view that is.


-- Posted Thursday, 14 March 2013 | Digg This Article | Source: GoldSeek.com

comments powered by Disqus



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2019



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


Map

The views contained here may not represent the views of GoldSeek.com, Gold Seek LLC, its affiliates or advertisers. GoldSeek.com, Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, Gold Seek LLC, is strictly prohibited. In no event shall GoldSeek.com, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.