Posted: 21 Feb 2014 02:35 PM PST

The gold price ended Friday with a third week in a row of gains after bullish positions held by large investors soared again.

By the close of regular trade on the Comex division of the New York Mercantile Exchange, gold futures for April delivery – the most active contract – hit $1,323.60 an ounce, up $6.70 from Thursday's close.

There appears to be a definite shift in sentiment this year after 2013's dismal performance with the smart money only now catching up with gold's almost 10% rise this year.

Long positions – bets that the price will go up – held by so-called managed money increased by 8% to 140,840 lots in the week to February 18 according to Commodity Futures Trading Commission data released after the close of business on Friday.

At the same time short positions were cut by 10,603 to just under 50,000, which translates on a net basis hedge funds holding 31% more bullish positions: net longs of 90,942 lots or 9.1 million ounces.

Net longs jumped 17% in the week to February 11, CFTC data showed. Net longs fell to a paltry 26,700 lots in early December when shorts held by large investors peaked at more than 80,000 lots.

That was the highest number of short positions since 2007, back when gold changed hands for $700 an ounce.

Gartman 'quietly' turns bullish on <b>gold price</b> | MINING.com

Posted: 20 Feb 2014 04:24 PM PST

After falling to a session low of $1,307 shortly after the open on Thursday, the price of gold came back in late trade at just a shade under $1,325.

Earlier in the day traders made the most of gold's recent strong to book profits on news of a drop in weekly jobless claims and a jump in manufacturing activity to an almost four-year high in the US.

Gold has been receiving a boost from some unfamiliar quarters recently.

Noted investor and a closely followed newsletter writer for the past 20 years, Dennis Gartman told Hard Assets Investor he does not consider himself a gold bug, but that he has "quietly turned bullish on gold for a few reasons:

Firstly, beginning five and six weeks ago we started to see a lot of the mining companies— even the largest gold mining companies— begin to curtail production. That's always a sign of an end of a bear market.

When senior management at the largest gold mining firms throw their hands up in dismay and begin curtailing production, usually within weeks the lows are going to be found. Decision by committee is always that way. It's slow; it takes time; and it's always late.

Two, I don't see any major reduction in accommodation that the Fed is pushing into the system. We are far from tightening; we are still aggressively easing, with $65 billion still going into the system between each FOMC meeting. Yes, that's down from $85 billion, but still, those are massive injections of reserves into the system. The Bank of Japan is doing even more than the Fed.

Thirdly, supplies are tight. The fact that gold futures moved to a very modest backwardation indicates how tight deliverable supplies of gold are. And finally, when you go and speak at "gold bug" conferences, the populations are down by 40%. That tells you something. Throw all those things into the pot, stir them around a little bit, and it tells me it's time to be bullish.

Gold prices have gone down, and the market has beaten prices up about as much as they can. Bad news came out several times; you've had gold being downgraded by multiple brokerage firms, and it didn't break.

On Thursday Edel Tully, precious metals strategist at Swiss investment and London bullion bank UBS, said she is moving from "outright bearish" to "neutral/slightly positive" and upping the bank's forecast of the average 2014 price by a full $100 an ounce.

After a dismal 2013 that saw gold lose 28% in value and suffer the worst price performance in 32 years, the yellow metal has surprised a few pundits, gaining 9.6% year to date.

Read the full Gartman interview here.

<b>Gold Prices</b> To Rise on Bullish Technical Charts

Posted: 22 Feb 2014 01:11 AM PST

Reuters

Gold prices to rise further next week on bullish technical charts.

Gold prices are set to rise further next week, supported by bullish technical charts.

As many as 19 of 23 analysts polled in a Kitco Gold Survey said they expected gold prices to rise, while two predicted that prices would drop and two forecast prices to remain unchanged.

Ralph Preston, principal, Heritage West Financial, listed several technical-chart points -- The double bottom lows from July and December 2013, gold rising above $1,280 and breaking the downward sloping trend-line drawn over the peaks of August at $1,430 and October at $1,375, and the metal rising above the 200-day moving average, which comes in Friday at $1,308.80, Preston told Kitco on 21 February.

Adrian Day, chief executive at Adrian Day Asset Management, said the change in sentiment for gold, which compelled formerly bearish traders to scramble, also helped the metal.

Kevin Grady, of Phoenix Futures and Options, said: "We continue to see tightness in the forward markets which I feel will spill over into the futures. Although the jewelers do not appear to be buying at these levels, there continues to be a bid under the market. This leads me to believe that we may be seeing some central-bank buying.

"A key factor for gold this week was the release of the Federal Reserve minutes. Although the verbiage led us to believe that the current tapering plan would continue, the gold price held up under immediate pressure. The 200-day moving average comes in around $1,305. We need to hold this area for gold to attract new buyers," Grady said.

HK Statistics Department, Commerzbank Research

China's imports of gold from Hong Kong.

Commerzbank Corporates & Markets said in a 21 February note to clients: "The price of gold has recently climbed to its highest level since October 2013, the main reasons being a weaker dollar, speculative buying and lower outflows from gold ETFs. Last year, investors took some 900 tonnes of gold out of ETFs and contributed significantly to the slump in prices.

"Strong physical demand from China in particular should continue to support the price of gold in the medium term. The January figures from Hong Kong's Statistics Department on gold trade with China, due out next week, should confirm high Chinese buying interest. That said, the potential is limited in the short term."

Commerzbank Corporates & Markets said in a separate note: "For the first time since 1980, Switzerland [on 20 February] published detailed statistics regarding its gold trading activities, showing that around 85 tons of gold were exported to Hong Kong in January; this accounted for almost half of the country's total gold exports. The gold is likely to have been shipped on to China, which points to continuing high gold demand there. The Census and Statistics Department of the Hong Kong government will be reporting during the course of next week on its trading activities with the Chinese mainland.

"Other major buyers of the Swiss gold were India, Singapore and the United Arab Emirates. Switzerland does not produce the gold itself, however; it imports it from other countries and then melts it down to sell to Asian buyers in smaller units. By far the largest quantity of gold (119 tons) was imported from Great Britain - part of this total is likely to have come from sold ETF holdings. This underpins the gold flow from west to east that has been underway for months now."

Gold Ends Higher

Spot gold inched up 0.2% to $1,324 an ounce on 21 February, down from the three-and-a-half month high of $1,332.10 struck on 18 February.

US gold futures for delivery in April finished $6.70 higher at $1,323.60 an ounce on 21 February.

For the week as a whole, futures added 0.38%.

Bullion prices have risen over 9% so far this year as concerns about global economic growth boosted the precious metal's safe-haven investment allure. However, prices are still far below the record high of around $1,920 per ounce struck in 2011.

Gold price: Hedge funds add 30% to bullish bets | MINING.com

<b>Gold price</b>: Hedge funds add 30% to bullish bets | MINING.com

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