New Gold Buying in July
Source: Kitco, Allen Sykora (7/21/11)
"Increase in futures open interest shows enthusiasm for the market by new participants, as well as confidence in still-higher prices."
The run-up to record high prices for gold this month has been accompanied by a double-digit percentage increase in futures open interest, and that's a short-term bullish indicator, analysts said.
It shows enthusiasm for the market by new participants, as well as enough confidence in still-higher prices for traders to hang onto positions overnight, they said.
The caveat, however, is that the influx of new buyers also could mean some so-called "weak longs" might be forced to liquidate quickly if prices suddenly move against them, adding to any selling pressure in a correction. . . View full article