"David...what facts or data leaves you to believe gold is an overcrowded trade...or is this a hunch on your part."

Eoin Treacy's view I did not say gold was an overcrowded trade. I said it was a somewhat crowded trade. There is a difference. Here is the paragraph in question:

Despite remaining bullish of precious metals for all the reasons discussed by this service in detail over the last decade, I am more cautious today because they have become a somewhat crowded trade. Precious metals can certainly become a much more crowded trade in coming years and I am on record for saying that gold's primary bull trend is likely to end with the price accelerating during a mania. Nevertheless that is a technical hunch based on other secular trends such as gold's last bubble peak in 1980. Therefore I will rely almost entirely on factual, behavioural technical action for the duration of the present secular bull trend in precious metals. In other words, I an content for the market to show me what it is going to do. This will be infinitely more useful for timing, in my opinion, than subjective and emotional fundamental projections which are often no more than a wish list.

My perception that gold was a somewhat crowded traded is based on all the bullish commentary that I see and hear, plus the flow of funds into bullion ETFs. There is a growing consensus that every portfolio should have some gold. I do not disagree but some people have bought gold because they do not trust anything else. They will probably be among the first to sell when confidence next improves. That is very unlikely to break the overall upward trend but it could be a temporary headwind. We had a hint of this today.