Gold Price: The Moment Of Truth

New York (July 12)  Here we go again. Gold can’t seem to hold a rally and is now testing the bottom of the range. Failure here could be a disaster for the yellow metal, which has struggled mightily since peaking on April 11 at $1,369.

Gold  is now down almost 10% from those lofty levels, nearing correction territory. The $1,235-$1,240 area is the line in the sand, as failure to hold these levels would bring $1,200 into play and possibly lower. The trend is lower; gold is testing a double-bottom support level.

Most of this beating has been done on moderate volume with only one real washout day that gold has still not recovered from. We expect support to hold but are very concerned about the trading action. In the next day or two, gold better bounce or here comes $1,200.

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