The gold price has corrected sharply over the last couple of trading days – breaking the strong support zone at $1,550-1,525/oz and heading straight for the next significant technical support point at $1,300.
The immediate catalyst seems to have been the theory that Cyprus would be pressured to sell a large part of its official gold reserves as part of the bailout deal. At less than 14 tonnes though, this was hardly a market-moving event; however, the theory that future bailouts in the EU could carry similar conditions spread, and countries like Portugal and Spain do still have significant reserves. With 2,452 tonnes of gold Italy’s reserves are second only to Germany’s, and the Italian political situation and economic decline is uncertain enough that rumours that this gold might be in play were at least plausible.
All this rumour mongering, together with…
Read the complete article at GoldMoney here.
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