Gold is an alternative to the U.S. dollar, and while dollar-denominated assets have had a good run this year, a turnaround soon can be expected, said John Doody, founder of the Gold Stock Analyst.

"All of the near-money types, gold, silver, and bitcoin, they're all down this year. When is it going to turn around? I think soon, because nothing goes forever," Doody told Kitco News.

Doody noted that the Commitment of Traders report showed the highest level of net short positions on gold ever recorded, with 15% of the open interest in short positions.

"To be going against the contango, to be going net short means that there's a lot of buying power to be released when something sparks it in the other direction," he said.

Doody added that the last time there was a high percentage of short positions, minus 3 percent of open interest, gold rallied 30% the next year, and gold stocks climbed 78%.

This article is commentary by an independent contributor. At the time of publication, the author held TK positions in the stocks mentioned.

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