We enjoy picking on the Economist of course, but our main motive for dissecting its editorial on gold was to show that the gold market remains widely misunderstood. Moreover, given the Economist’s record as a contrary indicator, it might prove to be a useful marker, although we don’t want to make too much of this (if it had been a cover story, we’d recommend mortgaging the house and renting a vault). In the meantime, the fundamental backdrop for gold remains largely in neutral, with some factors improving and others not. However, buyers seem to be willing to step in every time gold dips below the $1,200 level. Technically it remains in no-man’s land in dollar terms, but continues to look encouraging in euro and yen terms. Maybe the Economist has managed to ring the bell after all? Stay tuned …