Gold has enjoyed an amazing rally in recent weeks, catapulted higher by the extreme fear sparked by the sharp stock-market correction. Naturally such big and fast gains have led to a surge in gold’s popularity among investors and speculators, as everyone loves a winner. But gold prices flow and ebb like everything else, and this metal has become very overbought today.
With the plunging stock markets terrifying traders, many are running for the hills. Steep selloffs always generate intense fear, a scary emotion from which we humans are naturally hardwired to flee. But in the stock markets, major fear spikes should be embraced. They mark the best opportunities ever seen to buy low, the necessary prerequisite to selling high and multiplying your wealth.