From today's Gartman Letter...... (10-21)

"Regarding gold, we remain quietly long of it in US dollar terms, and in terms of the EUR and the British pound Sterling. We see no reason at this point to change our thesis, although we’ll bring stops up on the portion we own relative to the US$ to $1035 simply to make certain that we protect this late addition to our long standing gold trade from turning from a profit to a loss.

Finally, regarding the notice given two days ago that the CME was willing to take gold for original margin, the more we consider this the more disconcerted we become for we’ve been around too long and we’ve seen too many new products and/or ideas turn into ill rather than good. For example, consider the possibility that we have a rout on the downside in the commodity markets that takes everything down simultaneously and materially. If we have learned anything in the past several years it is that when things collapse they collapse in tandem. On the downside, all correlations go to “1.” That is the lesson of last year. Thus, if commodities were to slide, and if gold were to slide too, then the CME might find itself in a very uncomfortable position as variation margins call go out and as original margins diminish in value, forcing those same firms to issue further margin calls. We are not comfortable with that possibility. Clearly we hope that the CME’s leadership has considered the ramifications involved in taking gold as original margin, but what if they have not? Really, what if they’ve not?"