There are two reasons which proves gold has not topped out:
1. The gap between yields on US Treasuries and TIPS (Treasury inflation adjusted security) due in 10 years, a measure of the outlook for consumer prices, closed above 2.25 percentage points four days last week, the longest stretch since August 2008. TIPS being an instrument issued by Fed, which protects investors from inflation in a way that principal will increase with the rise in inflation. The yield on TIPS is negative, negative yield in inflation signifies that investors are giving away the yield for the sake of protecting themselves against rise in inflation. Rising difference between treasury and TIPS, seems to be positive for Gold in long term as Gold has been traditionally considered as hedge against inflation.
2. SPDR Gold ETF has risen from 1,116.247 tons on 08/12/09 to current levels of 1,132.708 tons. The current holding is near to its life time high of 1134.03 tones. The rise in holding has coincided with fall in gold price, it just goes on to prove that demand for the metal has not at all detreotiated despite recent sharp fall in prices.
12/01/10 Gold has recovered from the day of the posting of the article, stating that fall in gold has given chance to investors to buy the gold. Price made a high of $1161 in COMEX and 17104 in MCX.