Although price hesitation occurred on Wednesday and Thursday, we continue to retain our upside view on the commodity as long as it holds above the 1,329.25 level. Initial resistance lies at the 1,378. 80 level with a clearance of that level extending gains towards the 1,392.25 level, its Jan 13'2011 high. We expect a cap at that level to turn the commodity back lower but if that fails, a push towards the 1.431.28 level and the 1,450.00 level could occur. Alternatively, below the 1,307.60 level will have to be traded to reverse its present bullish attempt and turn focus to the 1,300.00 level, its big psycho level. We expect this level to provide a strong support and turn the commodity back up on an initial test because of psychological importance. However, if it snaps, Gold should weaken further towards its long-term rising trendline at 1,288.75.
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