The opposing view is that a possible rate cut will force the USD into a weaker position bolstering gold prices. The COT report from October 16th, 2007 shows a greater than 3:1 ratio for commercial shorts compared to longs.
Here is the picture for gold from the COT report:
Silver is in nearly a precarious situation as gold with the commercial silver short to long ratio standing at approximately 2.3:1.
My guess is that if a rate cut occurs at the end of the month, the commercial shorts will be forced to cover their positions causing precious metals prices to erupt upward. This wont be your typical pop for gold and silver as the commercial short ratio is quite large.
Here is a note about COT option and future positions taken from this article:
The raw data analyzed below was obtained from the CFTC’s famous Commitments of Traders reports that it publishes weekly. These CoTs are data-rich and offer all kinds of valuable information on long and short positions that traders are taking in commodities futures. Charted over time, the CoT numbers help illuminate long-term futures trading trends that can affect commodities prices.
The official COT summary of options and futures for gold, silver and copper can be found here: http://www.cftc.gov/dea/options/deacmxsof.htm