mineweb.com / By Lawrence Williams / Thursday , 22 Aug 2013
Image may be NSFW.
Clik here to view.
While not too much should yet be read into a small rise in the SPDR gold ETF’s holdings last week, the very fact that this represents the first weekly rise for around 9 months is giving the gold bulls some heart after a dire couple of months. Whether it yet indicates a reversal of the recent trend which has seen the ETF’s gold holdings fall from over 1300 tonnes of gold down to a little over 900 tonnes will require several more weeks, or months of rises to confirm. Last week’s rise was from 909 tonnes to 915 tonnes, although the holding appears to have fallen again, but by only just under two tonnes, so far this week, coinciding with the gold price appearing to have run into a temporary wall.
What the gold followers are looking out for is some reliable indication that the fall in the gold price has bottomed and the jury is still out on that. Certainly the past couple of weeks have seen gold seemingly return from the abyss and many observers believe that the yellow metal is currently in a consolidation phase at, or around, its likely nadir. There are still some though – not just the out and out gold bears – who do see the possibility of further falls to the $1200 level or even lower. But, in relative terms, the potential downside would seem to be fairly limited at current price levels.
Bulls are also taking some heart from gold’s reaction to the latest FOMC minutes – true the price fell back, but only by a small amount, despite some indication that the Fed is planning a soft exit from its bond buying programme sooner rather than later. Also, there is a feeling that the heavy hitters who have been offloading gold out of the SPDR ETF may have largely completed their selling.
