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To: pater tenebrarum who wrote (66994)	10/6/1999 8:30:00 PM
From: Lucretius	Read Replies (1) \| Respond to of 86076

at some point it won't matter what data they spin out... people will simply stop trusting the numbers and then we get something REALLY ugly buy more goldshares....... everybody is STILL bearish.. gold hasn't even gotten started..... traders' comms on fri will likely show producers VERY long and specs even MORE short... case in pt-- the article below..... Gold may fall below $300 in early 2000--analysts TOKYO, Oct 6 (Reuters) - Gold prices will likely remain in a range between $280 and $330 an ounce, and may fall below $300 early next year, as more producers are expected to jump into the market as hedge sellers, analysts said on Wednesday. The analysts were attending a major gold conference in Tokyo sponsored by the Nihon Keizai Shimbun, Japan's leading financial daily. Some analysts said many short-sellers, who drove bullion prices sharply higher the past week, have covered their positions. But others said a lot of short positions remain in over-the-counter market (OTC). "Gold is likely to stay in a range between $280 and $330 and may fall below $300 early next year as three quarter of the total shorts were covered already," Andy Smith, London-based analyst with Mitsui Bussan Commodities, told the conference. Spot gold was trading around $325.00 per ounce in early London trade on Wednesday. Smith said miners had sold calls for forward dates to hedge and to generate premium income. Dealers had sold call options for nearby dates to cover their exposure to forward dates. The volatility of gold surged to about 40 percent recently, from 10 to 11 percent before 15 European central banks agreed to curtail gold sales on September 26, Smith said. The recent surge in bullion prices has forced some producers to restructure their hedge books, said Paul Walker, director of Gold Field Mineral Service. Many traders believe current short positions in the bullion market total about 10,000 tonnes, Paul said, adding he believed the actual amount was much less. "Our estimation of the short is about 400-500 tonnes maximum, and that includes hedge funds," Paul said. "Undoubtedly they have been covering theirs positions and that's why we have seen the prices moving." But George Milling Stanley, a World Gold Council analyst, said: "A good deal of short-covering is on the futures exchanges, primarily COMEX. There is also still a good deal of short-covering from speculators on the OTC market." Short sellers included hedge funds, commodity trading advisors, proprietary traders, bullion dealers and non-bullion banks, he said. "They covered shorts in COMEX first, that's why we saw big volatility recently," Milling Stanley said. "But a lot of shorts are remaining in the OTC market. Normally OTC turnover is 10 times higher than that in COMEX," he added, indicating there will be another upswing in gold prices. With current volatility, lease rates and gold prices remaining at high levels, mining companies are reluctant to hedge forward dates, he said. Analysts said producers would actively hedge if volatility, lease rates and gold prices return to normal conditions. With bullion prices surging, analysts said there have been no dramatic changes in production and scrap supply as producers are taking a wait-and-see attitude until the market calms down. Producers were not responding yet to the recent price jump. But if the bull run in the bullion market is sustained, they will increase output, they said. They said they could not rule out the possibility some other central banks will take advantage of current higher lease rates through lending. reuters.com