Fool's Gold?

Last May, it was disclosed that the massive George Soros hedge fund had sold most of its investments in gold.  Soros, himself, negatively referred to its high prices as the "ultimate asset bubble."  At the time, gold was selling in the low-to-mid $1500's an ounce and many just scoffed at Soros short sighted selling; believing that it could easily double in price over the next two to three years.  Gold, in fact, did continue its 12-year stratospheric rise by reaching the $1903 mark as of August 22nd of last year.  But, that was the top.  Since then, gold has fallen.  Last week it hit a 9-month low of $1541; 19% off last year's high.

In the last 3 months, the dollar volume in gold sales has been extremely heavy with the price sliding downward in the process; but not that dramatically.  It appears that there are enough buyers to match the heavy selling; and, as result, this has kept it from going into free fall.  At this point, gold seems to be at a breakpoint of sorts.   If selling dries up, then it will stabilize and either move sideways or back upwards in price.  But, if buying dries up and the selling continues, the Soros prophesied bubble will break and we could see a serious fall in the price.  Maybe even below $1000 an ounce.  

In my opinion, anyone buying gold right now is foolish.  No one should buy unless it breaks out of its current downward trend line. I for one, am betting that Soros is right about it being in a serious bubble and fully expect it to crash within the next 3 to 6 months.