If a large number of calls become converted to active August contracts, then a 'gutcheck' to test the new contract holders on Friday or Monday may be anticipated. That does not mean that shorting or selling is a sure thing for the momentum speculators.
The delivery period for the August contract begins at the end of next week. The inventory levels at the COMEX are dangerously thin if a robust delivery mechanism for physical bullion remains functioning. The word of the gold supply situation has gotten out to the general trading news sources.
A failure of the exchange is almost unthinkable given its consequences and the effects on an already eroded confidence and reputation.
As we have recently seen, lower prices may have gleaned bullion from the gold ETFs, but it triggered a wave of physical bullion, particularly from Asia, that has placed the exchange systems in London and New York at risk.
I have highlighted the key support levels which will test the slanting W formation on the chart.
What happens will confirm the formation, or not, and help to set a minimum price objective from that formation if it does.