truthingold.com / By truthing / May 23, 2013, 08:40
Hedge funds are making the biggest bet ever against gold prices, signaling continued volatility for the metal after prices entered a bear market last month.
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The chart shows that gains in so-called short contracts are usually followed by increases in a gauge of price swings for the SPDR Gold Trust, the biggest bullion-backed exchange-traded fund. Yesterday, the value of the SPDR Gold ETF climbed as much as $1.5 billion before ending the day down $418 million.
Bullion has tumbled 18 percent this year as some investors lost faith in the metal as a store of value and amid concern that the Federal Reserve may scale back economic stimulus. Prices in New York yesterday rose as much as 2.6 percent before settling down 0.7 percent as Fed Chairman Ben S. Bernanke testified before Congress.
