GOLD: Biased To The Downside Below Its Trendline Resistance

Though hesitating, GOLD remains biased to the downside as long as it continues to trade and hold below its declining trendline currently seen at 1627.47. This development should eventually see the commodity return to the 1,557.30 level, its Jun 08'2012 low where a break will drive it further lower towards its key support located at the 1,527 level. A cut through here will resume its broader medium term weakness and then pave the way for further declines towards the 1,500.00 level. Price hesitation could occur here but if that level gives way, expect Gold to decline further towards 1,478.05 level. Its weekly RSI is bearish and pointing lower supporting this view. The alternative view will be for the commodity to return above the 1,632.85 level thus opening the door for more upside towards the 1,670.70 level. Further out, resistance stands at the 1,700 level. All in all, GOLD continues to hold on to its broader medium term downside as it looks to resume that trend.