The Gold Sector Is Due for a Shake Out

Suddenly, everyone wants to buy gold stocks. [Jeff Clark's Market Minute]( The Gold Sector Is Due for a Shake Out By Jeff Clark, editor, Market Minute Suddenly, everyone wants to buy gold stocks. That means, the sector is due for a short-term shake out. Let me explain… Gold stocks have been on fire lately. The Gold Bugs Index (HUI) was trading at 200 at the end of February. It closed Friday above 262. That’s a 31% gain in just seven weeks. And, as is often the case, price action has a way of changing investor sentiment. Recommended Link [5 Tiny Cryptos That Could Soar During 2024 Crypto Bull Run]( [image]( One of the first ever crypto millionaires who bought Bitcoin when it was trading for just $5 in 2011 is back with his next huge prediction. A newly approved government regulation is set to flood trillions of dollars into the crypto markets, leading to the FINAL crypto bull run. One of the “Kings of Crypto” has revealed five tiny cryptos that could soar over the course of 2024. Potentially resulting in gains as big as 10X, 50X, or even 100X over the next 12 months. [Get His #1 Coin For 2024 FREE By Clicking Here.]( -- Nobody wanted anything to do with the gold sector in late February. I know this because when we published a [bullish essay on gold stocks]( on March 1, we got lots of feedback from readers threatening to cancel their free subscriptions. Now, most of the feedback we get about gold and gold stocks is from readers wanting to know if they should chase the prices higher. The short answer is “No.” For the long answer, take a look at this chart of the Gold Bugs Index… [(Click here to expand image)]( The first thing to notice about this chart is how the recent rally is quite similar to the action during the same time last year. Indeed, March and April tend to be seasonally bullish for gold stocks. But, that seasonal strength ends in May. The gold sector tends to decline through the summer and into the fall. Notice also that all of the momentum indicators at the bottom of the chart have started to decline from overbought conditions. This too is similar to what happened about this time last year – just before HUI lost about 30% of its value. Of course, that doesn’t mean we’ll see the same sort of decline this year as well. Even after the recent rally, gold stocks are still about as fundamentally cheap as they have ever been. And, the reasons for owning gold as an inflation hedge and as a store of value are as strong as ever. Free Trading Resources Have you checked out Jeff's free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career – at zero cost to you. Just [click here]( to check it out. So, I still like the idea of owning gold stocks for the intermediate- and longer-term timeframes. I expect the sector will be even higher by the end of the year. For the short-term, though, I’m skeptical. Investor sentiment towards gold stocks has gone from bearish to bullish too fast. This is happening just as we are entering a seasonally weak period for the sector. Rather than chasing prices higher, traders will probably do better by being patient and waiting for the gold sector to work off its current overbought conditions. Chances are, we’ll get a better opportunity to buy the gold stocks a few months from now. Best regards and good trading, [Signature] Jeff Clark [Jeff Clark's Market Minute]( Jeff Clark Trader 55 NE 5th Avenue, Delray Beach, FL 33483 [www.jeffclarktrader.com]( To ensure our emails continue reaching your inbox, please [add our email address]( to your address book. This editorial email containing advertisements was sent to {EMAIL} because you subscribed to this service. To stop receiving these emails, click [here](. Jeff Clark Trader welcomes your feedback and questions. But please note: The law prohibits us from giving personalized advice. To contact Customer Service, call toll free Domestic/International: 1-800-752-0820, Mon–Fri, 9am–7pm ET, or email us [here](mailto:contactus@jeffclarktrader.com). © 2024 Omnia Research, LLC. All rights reserved. Any reproduction, copying, or redistribution of our content, in whole or in part, is prohibited without written permission from Omnia Research, LLC. [Privacy Policy]( | [Terms of Use](