Has a Gold Bottom Formed?

Pinnacle Digest writes: In this article Clif Droke breaks down exactly why he believes gold is starting to look attractive once again.

Droke explains the problems gold has faced since last year and how the CME Group triggered this nearly year long bear-market after it raised margin requirements. This was a catalyst behind why hedge funds left the gold trade as many invest with significant amounts of leverage. Gold just became at tad dull for these high octane traders and as a consequence, its price has been in a downtrend for 9 months.

Droke points to a number of technical indicators which make a case for higher gold prices starting in June. What must be noted about the significance of this article is that Clif Droke is not a gold bug at all. He is a widely recognized financial author and trader who believes deflationary threats are widespread.

Droke points to a significant event last week in the market which could foreshadow a change in investor sentiment toward gold. He noted how the S&P collapsed every day last week, and for the first time in a very long time, gold showed strength in the same period - rallying on market weakness. Could this be a sign of a flight to safety in gold or just a clear message the precious metal is oversold?

Click here to read Clif Droke’s entire article.