Is gold finally ready to end its decade-long rally? Over the long-term, I suspect not. While inflation, for the moment, seems subdued, the karma of printing all this money (bailouts, toxic asset repurchases, FX swaps, quantitative easing) will eventually catch up with us once the economy starts to recover and grow.

But, in the short-term, there's no denying that price for an ounce of the yellow metal is certainly dropping, and not particularly due to any significant change in supply and demand (last time I tried to fill a large bullion order not many of the smelters had anything left to sell, as the gold dust already had a buyer the moment they dug it out of the ground).

So where can we expect to find bottom?

Having broken both a month-long consolidation pattern as well as the key 1666.66 Fibonacci support level, we now have to return and test this level from underneath as our new resistance. If it holds, look for a drop down to 1617.24, eventually maybe 1586.71. If instead price manages to get back above 1.666.66, and hold that level as support, we can expect a return first to 1716.08, and perhaps eventually 1746.61.

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