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[dollarbear]

09:36 ET Gold selloff a buying opportunity: NEM; PDG -- Goldman Sachs : Goldman Sachs says the selloff in gold is a buying opportunity. Top picks are NEM and PDG (each offering 25% upside). Gold has sold off $20/oz over the past 2 days to $400/oz due to US dollar strengthening and speculator liquidation. The firm considers this a buying opportunity and sees a possible 22% upside on the XAU gold index because: (1) The dollar will resume weakening against the euro (to 1.30) the yen (to 95) and the renminbi (to 7.5) with a 6 to 12 month outlook; (2) The Fed will not begin to tighten monetary policy until sometime in 2005, which is an out-of-consensus view, although risks of tightening in August '04 have increased; and (3) Possible France Central Bank gold sales a neutral development, as it would be covered by the recently renewed Frankfurt Agreement. The firm believes gold will trade toward the top of the firm's forecast trading range of $390 to $450/oz, averaging $420/oz in 2004.