The biggest threat to Gold comes from the Euro.In the past,...

The biggest threat to Gold comes from the Euro.

In the past, investors fleeing the US$ have but one choice GOLD. That is no longer the case. Euro now presents an alternative. In fact, UK treasury divested 60% of her gold reserves to US$, Euro and Yen. The Euro has been handicapped by UK reluctant to join the Eurozone. I think it is political (pressured by US) rather than economical. But, is a matter of time. You need to consider what happens when UK join the Eurozone. A stronger EURO emerges and presents a real alternative to the US$ - displaces GOLD as a safehaven.

At the moment, gold is held up by several factors, a weak US$, a less than developed Eurozone, speculation and the gold cartel. My speculation is that the gold cartel bought gold from several sovereign banks from around US$235. It is public knowledge that UK sold most of her gold around that price. Once the cartel completes its sales, gold price will lose a major ramper. My guess is that the cartel is supporting gold at $900 level for its distribution. A breakdown of that support level indicates the completion of its distribution and together with the end of speculative play will cause a major retrace in gold price. A Fibonacci number of 33% perhaps?