Europe gold grinds lower amid liquidation fears
8/24/2001 11:13:00 AM
LONDON, Aug 24 (Reuters) - Gold prices fell below key support at $274 on Friday afternoon as funds started to liquidate long positions and the market tracked a weaker euro, traders said.
By 1456 GMT spot gold was indicated at $272.00/272.50 a troy ounce, shedding more than $3 from morning levels and down from Thursday's New York close at $275.10/275.60. The metal was fixed at $272.80 a troy ounce in Europe versus $275.15 in the morning.
Market players were split on bullion's direction.
"There is no reason to panic. Personally, I see gold firming by the end of the day," a trader said.
Will we ever get to know who shorted gold? Well, at the moment here is one guess at who the longs are:
<<"There was some selling of gold by a central bank this week, the euro is not in its best shape at the moment so there is some pressure on gold prices right now," he said.
But other traders said they were wary of the spectre of liquidation by COMEX speculators with long positions, which some traders estimate at around four million ounces, the highest since August 1993.>>
Personally, I can't imagine that there are too many 'dumb' speculators buying gold futures... I mean, when was the public last in metals??? BWTFDIK, talking my position.
Also, there's this from Kaplan:
< As gold moved higher in recent days and the XAU completed a false bottom at 52, commercials have not only been selling gold short, but also intensifying their short positions in currencies including the Swiss franc, euro, Canadian dollar, and Mexican peso, and have recently gone short the British pound and Australian dollar, and even the Japanese yen. What all of this means is that the U.S. dollar is poised for a sharp move higher over the next couple of weeks, which will be negative for gold.>
Wow, what do the commercials see??? And also begs the question... is this guy any good???
dAK |
