Goldbugs disappointed, but keep the faith

NEW YORK (MarketWatch) -- Gold disappointed its friends last week. But they've not given up.
The yellow metal not only failed to resume the previous week's breakout attempt on $660, but swooned badly on Tuesday, back to levels not seen since March. A painful struggle back left spot gold at $647.50, a $2.60 loss on the week.
I like to check The Gartman Letter, a well-connected institutional service with a decent record in timing gold buys. But it was stopped out of a long after only three days. MarketVane's Bullish Consensus, a survey of futures trader sentiment, reported only 67% bulls on Tuesday, lowest since the January low just above $600.
Gold's feebleness jarred with what goldbugs angrily consoled themselves was a favorable news background: U.S. dollar weakness, reports of foreign central banks diversifying away from the U.S. unit, oil strength, sub-prime problems creating financial structure fears, bombs in Britain. But nothing heartened gold.
As I've reported earlier, there's a new, radical, Internet-based subset of goldbugs who directly argue that the gold market is manipulated by an alliance of public and private sector interests.
One of them, Australia's thoughtful gold webzine www.the-privateer.com was in the bittersweet position of having predicted before last week's action: "We think that an upturn ... will probably be delayed until after next week for the simple reason that the Fed's FOMC meets next week (on June 28-29) to decide on US interest rates."
(A surging gold price would have fed inflation fears.)
Privateer didn't seem consoled after last week's action. He wrote: "Marvelous, isn't it? The FOMC meeting this week was a "two-dayer" over June 27-28. June 26, the day before the meeting, the spot future Gold price duly lost $US 9.20 ... then dropped another $US 0.40 the next day to $US 641.70. By the end of the week, with the FOMC meeting safely "negotiated", the spot future price was back up to $US 650.90."