Gold is ready to rally and the Fed and interest rates have nothing to do with it

Gold last traded at $1,777 an ounce. Silver at $25.99 an ounce.

NEWS SUMMARY: Precious metal prices rose Thursday on bargain-hunting and a weaker dollar. U.S. stocks rose, recovering losses triggered by the Federal Reserve's surprise policy pivot last week.

Marketwatch--"Don't be surprised if gold begins to rally. The reason being that in the wake of gold's plunge last week, gold market-timers quickly turned bearish. That's a positive sign, according to contrarian analysis.

The gold timers' bearish turn represents a big shift in sentiment. On a number of occasions prior to last week, gold timers were excessively bullish. This meant that gold's path of least resistance was down.

Many missed this contrarian backdrop to last week's plunge, since there was a more immediate culprit: The announcement from the Federal Reserve's rate-setting committee that it might raise interest rates sooner than previously anticipated. Yet, from a contrarian perspective, the Fed's announcement was little more than the straw that broke the camel's back....

The key to the extent and duration of gold's subsequent rally will be a function of how quickly the gold timers turn bullish. If they quickly jump on the bullish bandwagon, then the rally will most likely fizzle out relatively quickly. If instead they stubbornly remain bearish as that rally gains steam, then it has the potential for lasting longer and rising further."