Owners of Gold and T-Bonds have done well of late, reflected by the sharp rally in gold and a decline in yields below. On a short-term basis, could extremes be at hand?
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I am putting together this post pre-market, so the day is young for sure. At this time Gold is up and was very near the key $1,900 channel/Fibonacci resistance level earlier this morning (see key resistance level) Gold is up around $20 per ounce at the time of the post, yet it is $25 off its highs hit in the overnight market highs, as Gold reached $1,896. Gold created a bearish upside wick on Friday, keep an eye out to see if it makes more of them up here at key levels.
Over the weekend I came across bond sentiment numbers, reflecting 98% bullish bond sentiment, very similar to readings hit one year ago this week (see bond peak elevation).
Is 98% bond bulls an extreme? I will let you be a judge of that! Per the “Power of the Pattern“ key support and resistance are in play in these two safe haven assets and if you have gains in the assets, it might be a rather good idea to protect them, at these short-term extremes.
If these channel extremes don’t contain Gold and Yields, stocks are in huge trouble!