Gold July 25 -- a trader said that "with an unusual amount
of $680 gold calls still open, it comes as no surprise
to me that the trade would like to keep gold depressed
through tomorrow."
After Tuesday's "collapse in the U.S. paper equity market,
some funds had to meet margin calls and reduce overall
risk levels," said Ned Schmidt.
"That selling is pushing down gold to an oversold condition.
Investors should be buying gold at these prices, while
deluded fund managers are selling," he said.
"The continuous capping of gold is frustrating at times
but is expected to be overwhelmed by physical buying
in the long run," said Grandich.
Julian Phillips, an analyst echoed this sentiment,
saying that "the fall has not prejudiced the change
of direction of gold yet.
Overall, long-term investors are dominant in the market,
making external factors (oil and the dollar) direction
deciders."
As for gold, "the funds had a field day, but long-term
buyers and physical buyers don't chase prices,"
said Phillips.
"Buying on the fall is the clever way, so now you should
begin to see a recovery.
From the middle of August on, should this happen, you will
see buyers rush in much quicker than we are seeing at
the moment.
But professionals will come in near support to take it
back up," he said.
"This market can be as exciting as driving a Ferrari,
if you keep calm on days like these."....
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