USAgold.com writes “Two months ago we warned of October being the month markets have been known to go bump in the night – 1907, 1929, 1987, 1997, 2007, 2008. Sure enough, on October 3 the Dow Jones Industrial closed at 26,828. By the end of the month, it stood at 25,116 – down over 1700 points and nearly 6.5%. Since then, stock market psychology has undergone a radical transformation – an abrupt reversal with important implications for the long term. The Wall Street Journal reported recently that “the investor trend that has helped buoy stocks over most of the past decade is showing signs of breaking down.”
So where would you put us now in the investor cycle depicted in the chart below?
We guesstimate that we are somewhere between “Euphoria” and “Anxiety” for stocks and “Depression” and “Hope” for gold and silver. In short, the time might be right for starting to leg-out of stocks and ladder-into gold. The last time we featured this chart in late September, we put stock market sentiment at somewhere between “Thrill” and “Euphoria” and gold somewhere between “Despondency” and “Depression.”
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