GOLD: Weakness Consistent With Its Broader Medium Downside Bias

With GOLD weak and vulnerable, further declines is likely towards the 1,546/41 levels. A cut through here will turn attention to the 1,527 level, its May 2012 low. While the 1,640/24 levels continue to hold as resistance levels, the above view remains valid. Below the 1,527 level 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 daily RSI is bearish and pointing lower supporting this view. On the upside, the commodity will have to break back above the 1,624.45 level to reverse its bear threats. This will set the stage for a run at the 1640.45 level. Further out, resistance resides at the 1,670.70 level. All in all, GOLD continues to hold on to its broader medium term downside.