Gold spent most of the month of February rallying from the corrective pullback that saw prices slip from the high of 432 dollars/oz in January to around 400 dollars/oz in the early part of February. The price struggled to make it towards 416 dollars/oz on two separate occasions in mid-February. Its climb was aided by the fall of the US dollar against the euro on the continuing lack of concern expressed by the US Federal Reserve for the US dollar's fall as it would help reduce the country's current account deficit. But gold failed to make any progress higher, and disillusioned longs started to liquidate and the sell-off in the price recommenced. Long positions on COMEX fell by 19 percent over last month to 95,788 contracts (or 298t) on 24 February. COMEX has managed to maintain a net long position of 63,058 contracts (or 196t), which is back to levels seen in August 2003 when the gold price was at 360 dollars/oz. The price ended the month just below 395 dollars/oz. The average gold price in February was 405 dollars/oz, trading between 392 dollars and 416 dollars/oz. This represents a fall of 2.3 percent on the January average when prices remained above 400 dollars/oz.
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