Spot Gold Prices dipped overnight from Thursday's 16-month Dollar highs, before rising again in London to break new ground for this bull run above $699 per ounce.
"Gold is now overbought technically," reckons Phil Smith for Reuters India, "breaking through some important technical resistance levels.
"But frankly," he adds, "support and resistance levels do not seem to have counted for much during the recent price action."
The Gold Price in Pounds Sterling broke a new four-month high above £345 per ounce. For Eurozone investors, the price touched €510.
"The market in London is buzzing," says Jessica Cross, head of the Virtual Metals group that produces Mitsui's quarterly Hedge Book analysis.
Speaking on South Africa's Classic Business radio show last night, she noted the rapid growth in exchange-traded gold held in trust – up 27 tonnes this week already – "together with rumors of a big producer buy-back we’re trying to get to the bottom of at the moment."
Also known as "de-hedging", buy-backs by gold mining companies who'd previously sold some of their future production using forwards contracts reached a record peak between April and June this year. The previous peak in gold miner de-hedging came as Spot Gold Prices raced to a 25-year record above $725 per ounce in May 2006.
Now the latest de-hedging rumors, coupled with surging demand from Western investors, look set to keep gold well-supported as the weekly close draws near today – the highest weekly close since that top of May last year.
What's more, "Seasonally, this is when gold comes alive," as David Meger tells the Chicago Tribune.
"From Asian farmers converting their harvest into a gold stash to Italian jewelers returning from vacations," says the paper, "the physical demand for gold, as opposed to gold futures and other gold-linked paper investments, tends to pick up starting in late summer."
Hence "the trend for gold is clearly very strong," adds Tatsuo Kageyama, an analyst at Kanetsu Asset Management in Tokyo, "but I'm worried about the speed. We could see some more profit-taking before testing $700."
"The subprime problems have shaken stock, currency and credit markets...it seems investors are treating gold as a last resort of investment. We are also seeing strong inflows into exchange-traded gold funds."
The gold held in trust by the StreetTracks GLD fund has now grown to a record 542.35 tonnes, a gain of 5% from this time last week.
Interested in Buying Gold for Investment today? Not every route into the gold market involves having to rely on a "trust" fund, rather than direct physical ownership. Nor do you have to face wide dealing spreads, as with gold coins, or a high-risk of paying fat fees or margin calls – as is the case with gold futures & options.
In fact, investors like you can now Buy Gold and own it outright while still only paying very low fees. You can enjoy full legal title to your gold, holding it securely in a private store in Zurich.
To learn more about this breakthrough in private gold ownership, click here now...