A few days ago, bullish sentiments towards gold significantly dropped to approximately 4 % which set the 96 bears against these fearless four bulls with a ratio of 24:1. With the gold currently rallying last week by $80, the question begs on how many of these bears will remain supple and adaptable enough to contemplate whether the same should change its present position.

One thing is certain, more and more of them will be forced to adapt or extinguish should the rally gathers enough force as many experts suspect it.

The frail market as experienced last week was the result of selling in anticipation and confirmation of the off-putting result of the Swiss referendum. As it happened, it was not even as close to a knee-jerk which resulted immediately after the announcement.

Since the bullish sentiment was already at rock-bottom, the market has nowhere else to proceed but up. Surely, this was counterintuitive since market movements are most of the time rare. Yet another short squeeze was on tack and that action was confirmed by a $1,130 low made last November which concluded the two-fifth waves that were earlier speculated.

The Swiss no vote only served to bring more inexperienced short sellers on the move. However, those that already took the opportunity to take profits as they saw a little more downside that were available. The same was a classic representation of the sell the rumour buy the news event.

The bears are presently on the run

The market is within the early stages of a large third wave up. The confirmation required is the rapid rise of the tramline which is beyond the last major high at the $1,250 area.

If the market retreats, it will not necessarily change the scenario in which the second wave will be lower.

The bears are on the run, and there is a need to see how many can adapt . Those that do will further add to the bullish consensus and as the market continues to rise, the bull/bear disparity will gradually even at the top. This is basically how the market works.

Finally, bearish gold seen last October at $1,250 area took profits much lower in early November. This time, the question is will traders think they are bullish? How can they make up their minds?