In an editorial this morning the New York Times announced that it wants the IMF to sell about 30% of its gold reserves to help the world's destitute people. A noble sentiment. But is it a good market call?
Of course, if the Times really wanted to help the poor it would want to get as high a price for the IMF's gold as possible. So, if we want to look at this as a market call, I guess we would have to put the Times in the bearish camp.
Now I have found the NY Times invaluable as an opinion indicator (see this post and that one) and generally find it profitable to "fade the Times", i.e. to do the opposite of whatever it is urging or encouraging its readers to do. So the Times' editorial makes me even more bullish on gold than I was in my last post on the subject.
In that post I said that I expected gold to drop to 402, the bottom of its current bull market box and then to rally to 500 or higher. I've updated the box picture in the daily chart above. I no longer think the market will reach 402 and now believe that the low of the reaction which started from the 458 level in December 2004 was made in the June 2005 contract at 412 on May 31.
Gold is going up from here.