Physical gold buying strong after price dip, gold prices outlook august 24 2011 ; Gold rebounded more than 1 percent on Wednesday after posting its worst drop in 18 months, as risk appetite retreated after Moody's downgraded Japan's debt rating and strong buying interest in Asia's physical market lent support.
The sharp drop in prices in the previous session triggered strong buying interest as Asia opened business, sending spot gold up 1.2 percent to $1,851.67 an ounce by 0303 GMT.
Some gold bulls say it's time to take money off the table after bullion prices rallied about $400 from the beginning of July to a record high above $1,911 on Tuesday. But there is quite a bit of downside risk if gold breaks below $1,800 on a sustained basis. It may go lower to $1,700 or so.
Physical dealers were busy with a flood of orders from countries including China, Indonesia and Thailand. India, the world's largest gold consumer, has yet to buy in bulk. Its festival and wedding season starts in late September and peaks during the Deepavali festival in late October.
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