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Message: POG - Governmental intervention?

From today's Gartman letter (emphasis mine):

COMMODITY PRICES ARE UNDER PRESSURE, AND GOLD IS ESPECIALLY SO as we remind everyone of our comments here yesterday suggesting the “possibility of something truly untoward and truly bearish of gold being floated by the European and/or the US governments this week, such as a gold sale by the IMF or gold sales by the legacy central banks of Europe or a gold sale by Washington et al.” We said yesterday that this was merely an intuition on our part, but that “were we the Obama Administration in dire straits or were we the Merkel Administration in even ‘dire-er’ straits we’d at least be considering gold sales.” Clearly someone has done exactly that, for there have been massive, relentless offerings of gold on the markets in Asia this morning. Reuters has called those sales “without limits” put upon them, and it would indeed appear to be governmental in nature. It is far too early to know who the seller was and continues to be, but if our intuition serves us as well as it has it shall almost certainly be a government of some sort. Time only shall tell. The weakness in gold is not unexpected, and we’d expect support for gold to exert itself along the well established trend lines that have defined the run higher over the course of the past several years. Since we own all of our gold in non-US dollar terms we shall “speak” here in those terms, looking for support for gold in EUR terms around the €1265-1275 level as it trades €1300 this morning, and for gold to find support at or near the £1125-1130 level as it trades £1145 presently. Gold’s high yesterday morning amidst near panic buying conditions was €1365 and £1200, so these are meaningful and serious corrections taking place.

It is for corrections such as this that we have kept our powder reasonably dry, intending to be a buyer of that last bit which we had sold two and three weeks ago plus a bit more when the opportunity struck. The opportunity is striking, but we’ll wait a while longer for a bit more weakness before putting our powder to work. “Time,” as Mick Jagger once said, “is on our side:”

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