I'm with you, Portee. The gold manipulation makes for a weird game.

Here's a great article on gold leasing by central banks, driving gold down. Very up to date - July 2008. The central banks are deliberately stepping on the price of gold:

"A negative gold lease rate is a strong indication that banks are manipulating gold's price downward right now. They are flooding the market with gold."

Here is the article

One of my favourite and very funny financial writers is the "Mogambo Guru". Here he does the same gold leasing story, with the metaphor of pizza thrown in (he is highly motivated by pizza!):

Mogambo article

All these forces can be seen as types of waves, like waves on the ocean. The trough of a set of waves from one direction drops your boat a little. When the troughs of a lot of waves - one from the wind, one bouncing off another continent, one from the passing freighter, one from a speedboat - all cross and for a moment you are in the trough of all of them, your boat drops precipitously. Youch! That is where we are now - KXL near 1.30.

A big gold leasing wave is passing over us, and gold is in a deep trough until the central banks have bought some of their gold back cheaply. Gold against the artificially puffed-up dollar is in a trough because the US is preparing to make more genocide, and because they didn't want to lose face at the Olympics next to the world's bankers, the Chinese, or for whatever reasons they goosed the dollar. And certinaly the dollar is goosed and that drives gold down. Not fundamentals, that's for sure. Oil is in a trough because all the hedge funds got scared at the same time, as their money is being withdrawn by the subprime collapse. They all head for the exits at the same time. M3 (availability of money) is in a trough because lending standards have gone up and the banks are broke - very, very broke. Broke like 1932. The gold juniors are down because they do best in a vigorous market, which we don't have, and because they are sold first when people get margin calls. And KXL has fallen off after the NR pressure ended (5 months, yeesh!) and is in its yearly August trough the same as most gold stocks - people are still dreaming that they don't have a job and a life to go back to and that they can stay at the cottage forever. People don't think about stocks much at the cottage.

So all those waves crossed us at the same time, and for a few days the ocean is high around us. Well, the ocean isn't going anywhere. Like a rising tide lifts all boats, a trough in the ocean is quickly filled and the waves move off to other shores.

That is why KXL is near 1.30 and I'm not letting it bother me.