Conversely, Gero said, declining open interest at a time of declining prices is a clue that much of the selling is in the form of liquidation by longs who no longer want to own gold.

FORBES: Rising Gold Prices, Open Interest Reflects New Buying In July

If gold prices were rising but open interest was declining, it would be less constructive.

FORBES: Rising Gold Prices, Open Interest Reflects New Buying In July

Most of the big changes in open interest the past 2-3 months have been declining so a rise of this magnitude indicates money returning to gold.

FORBES: Big Majority Of Survey Participants See Higher Gold Prices Next Week