Rockwell Advisors: The Eurozone crisis could have a positive effect on the gold price.

FOR IMMEDIATE RELEASE
(Free-Press-Release.com) November 11, 2011 -- The debt problems of some of the smaller European Nations have fatally wounded the premierships of Greece's George Papandreou and of Italy's Silvio Berlusconi and driven the euro to one-month lows against the dollar and eight-month lows against the pound as confidence dissolves over the ability of Europe's leaders to staunch the spread of the crisis.

Gold has climbed 4% this month, after touching its highest in seven weeks above $1,800 per ounce this week, still down from the record high of $1,920.30 per ounce reached in early September, but still pointing to $2,000 from the look of current options positions, Rockwell Advisors was informed.

Unlike earlier phases of market turmoil, such as the aftermath of the 2008 collapse of U.S. bank Lehman Brothers, when gold lost as much as 7% in a single day, or during this May's commodities "flash crash" that cut 3% off the price in two days, investors and analysts say gold looks unlikely to be sucked into a vortex of mass or panic selling.

"Whenever you get total panic, even gold goes down, because people take profit on their gold positions. When people start losing money very rapidly, they close down all positions including the ones that are sitting on a profit," Jesper Dannesboe, senior commodity strategist at Societe Generale told Rockwell Advisors.
"That's why you had that gold sell-off in September, when everything was in panic mode. You don't have quite the same panic mode right now. It's (an environment of) moderately bad news and that tends to be bullish for gold," Dannesboe said adding that no-one is ready to place bets on what happens if the euro melts down.

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