Gold surged through 1400 yesterday, pushing as high as resistance at the 20 DMA and the spike high from 22 May. Overnight, gold made a high of 1422 before falling back in the face of a strengthening dollar.

If gold breaks through resistance around 1420, the "double bottom" scenario becomes more likely and the likelihood of a move towards 1445 and 1485 increases substantially.

However, the trend is still down and the bulls are fighting against the tide, their task is not an easy one.  A fall back below 1400 will be seen as a failure to break the down trend and gold will be under pressure once again.

Oil has been falling hard recently, though the declines have had little impact on the price of gold.  A break below $92 will see much lower prices in oil.

The main driver of this gold rally is the sell off in the dollar, the inverse relationship between the dollar and gold reasserting itself strongly in recent trading sessions.  If the dollar cannot rally back up to 84 soon, the dollar may fall further as this will be seen as a failure to break key resistance.

Equities continue to correct - whilst it is too early to say that the rally is over, gold bulls will be watching stocks closely for signs of a top, as this will be seen as bullish for the yellow metal.

Today's video for subscribers looks at the recent trading action and our strategy for our next trade.

Gold moved steadily higher yesterday, though could not break through resistance around 1400.  Overnight, the move higher has continued and the market has broken through 1400, with gold hitting 1410 before falling back to currently trade around 1405.

However, the move higher is not particularly convincing and the rally continues to meander higher in an overlapping, corrective manner.  With resistance above at 1414 (the 20 DMA and 22 May spike high) and 1420, we do not expect a major rally to unfold here.

Should equities correct sharply and the dollar continue to fall, we may see a strong rally develop in gold,  though this is not our most likely scenario.

The dollar has struggled to maintain the 84 level and sold off sharply yesterday, along with oil and equities.  It is rather odd to see all three rally and fall together, trading inversely to gold and we do not expect this position to continue for long.

It is clear that gold is influenced strongly by the dollar and equities at the moment, though we would expect oil to be moving in tandem with gold rather than the dollar.

Today's video for subscribers looks at the recent trading in more detail and the possible impact of the upcoming Non Farm Payrolls number, released on 7th June.

With options expiry yesterday, gold moved erratically, falling as low as 1374 before shooting higher, touching 1402 and dropping back to end the COMEX session around 1380.

This meant that the 1400 calls, the 1375 puts and the 1350 puts all expired worthless, a job well done for the option writers.

Now that options expiry is out of the way, we should see the next trending move begin - we consider a move to the downside to be the more likely scenario.

The rally since the 19 May low has been meandering, choppy and overlapping and is clearly a corrective wave - compare the price action to the impulsive thrust down from 1488 to 1338 the previous week and this becomes clear.

ETF redemptions continue to pressure the price, with physical demand out of Asia countering this supply.  However, it remains to be seen for how long this outflow from ETFs can continue without having a serious impact on the price of gold.

The dollar is back above 84 and attempting to hold this key level - a decisive break will see the dollar move much higher, with 88 the first target.

Oil continues to move lower in a volatile range, though yesterday surged higher, making a "lower high" at $96 on the daily chart.

We have been saying for many months that the next rally in gold will not start until equities correct meaningfully -  the two "shooting star" candlesticks on the S&P daily chart need to be watched as they could be an early warning sign that a top is forming.

Today's video for subscribers looks at yesterday's action in more detail and the impact of options expiry on prices.

With the London markets closed for a Bank Holiday and US markets closed for Memorial Day, the trading was very quiet yesterday - gold moving in a narrow range between 1384 and 1396.

The market tried unsuccessfully to break through resistance at 1400 on a number of occasions last week and looks ready to turn lower again after a feeble attempt at a rally off the 19 May low.

The recent rally has meandered higher, overlapping and criss-crossing in what looks to be a corrective move after what was clearly an impulsive wave down to 1338 the previous week.

Even if the market can manage to break through 1400, which looks unlikely at present, the 20 DMA at 1417 should provide resistance, with further resistance coming in at 1420.

The dollar fell sharply last week after failing to convincingly take out 84, though has found support at 83 and is moving higher again.

Equities continue to move higher, finding further momentum after breaking through the major "double top" formed from the 2000 and 2007 S&P highs.  We maintain our stance that the next significant rally in gold will not be forthcoming until we see a meaningful correction in equities.

Oil continues to move lower in a series of lower lows and lower highs, though the trading range is wide and volatile.

Today's video for subscribers outlines our strategy for our next trade and an overview of the bigger picture in gold.

Gold moved steadily higher for most of the day yesterday, again finding resistance at 1400 and backing off from that key level twice in the afternoon session.

It is clear that, whilst gold remains in a well established and strong downtrend, the market is attempting to form a base and start a new uptrend following the low at 1338 on 19 May.

If gold can rise from here, taking out 1400 and 1414 as initial targets, the prospect of a "double bottom" increases, however it will take a move above strong resistance at 1475-1485 to confirm this "double bottom" is valid.

The strength and influence of the downtrend cannot be underestimated and we remain bearish as long as gold is below 1525.  A move above this level will see us move to a neutral stance, with a break of 1800 required for us to move back to an all out bullish positioning.

It will be a long, hard road for gold back from here, though the huge open short interest is potentially the fuel required to sustain a major rally if the market can start to move higher from here and find a spark to reverse the trend.

We continue to maintain our stance that a major rally in gold will not commence until equities correct significantly - whilst it is far too early to call a top in stocks, the big sell off yesterday was a warning sign and a reminder that nothing goes up forever.

Today's video for subscribers looks at the recent trading in more detail and our strategy for our next trade.

As we expected, Bernanke's statement to Congress resulted in a highly volatile trading session and a $60 trading range in a couple of hours, with gold first surging higher as the statement was seen as accommodative to further quantitative easing before dropping sharply as more detail was given during the Fed Chariman's testimony to Congress.

Many traders clearly took the opportunity to offload gold into strength in the immediate upward move, with gold touching 1414 briefly before falling away and the bears have maintained the upper hand, with further declines likely from here.

A retest of 1322 will be a critical hold for the bulls, as a break of this level will suggest much lower prices in the near future.  However, if the market can hold recent support in the 1322-1337 range, a base may start to be formed from which a new rally phase could potentially evolve.

Oil also went on a rollercoaster ride, following gold higher and lower and eventually moving down, falling below support at $95 to currently trade near the bottom of the recent range at $93.35.

The dollar, predictably, moved inversely to gold and oil, first dropping, before rallying sharply to take out the closely watched 84 level.  This resistance area has been held overnight and the dollar will look to head higher from here, putting further pressure on the gold price in coming weeks.

Today's video looks at yesterday's trading in more detail and our strategy for our next trade.

Gold sold off steadily yesterday, falling as far as 1360 before finding support and moving higher, closing at 1374.

The bulls will be disappointed at the lack of follow through buying after the key reversal day on Monday, though the "bullish engulfing" candlestick has not been invalidated - however it will only take another small decline today to achieve this.

With Ben Bernanke's testimonial this afternoon and the FOMC minutes released at 7pm this evening, we could see a lot of volatility in gold today and the direction for the next few weeks may be determined by today's events and trading action.

The dollar is still having trouble breaking above key resistance at 84 - a break of this level will see a strong dollar rally towards 88, which would have bearish implications for gold - conversely a failure to break through this area could see a sell off in the dollar, boosting gold's appeal.

Oil has failed to break resistance at $97-98 again and has sold off a little - a break of this key level will see a strong rally in oil towards $106, however the repeated failures at this resistance area could see the bulls throw in the towel and the bears reassert control.  A break below $95 would suggest further declines.

With oil and the dollar at such critical areas and gold attempting to form a "double bottom" at 1337, today's events could have a long lasting impact on the future direction of all three markets.

Today's video looks at the recent trading in oil and gold in more detail and sets out our strategy for our next trade.

After plunging to lows of 1338 in overnight trading on Sunday, gold recovered a little during the London session before thrusting $40 higher without warning or obvious catalyst in the afternoon session, touching 1400 briefly before backing off.

Gold held onto the gains overnight and is currently trading around 1390.  The action yesterday formed a "bullish engulfing" candlestick on the daily chart, a reliable and powerful reversal pattern.

This suggests a short term bottom may be in and we are likely to see a rally of some sort over the next few sessions.  If, and its a big if, gold can move significantly higher from here and break above 1487, a "double bottom" would be confirmed with the 15 April low - however, the market is a long way from there and for now we maintain our overall bearish stance with further price declines expected.

Oil has moved back up to the resistance area around $97-98 - a move above here would suggest a rally to well over $100 a barrel.  However, another failure to break this resistance area would see prices tumble back towards the bottom of the current range at $92-93.

The dollar is consolidating at the key 84 level and has so far failed to break decisively above it - whether it does will influence the future direction of gold to a large extent.

Today's video for subscribers looks at the impact of yesterday's price surge in more detail and our strategy for our next trade.

Friday saw gold sell off steadily, with the selling intensifying as the market dropped below Thursday's low at 1369, resulting in gold closing near the weekly lows at 1354.

The market has continued to sell off overnight during Asian trading hours, though has found support at 1338 (the 18 April low) and bounced from this area to currently trade at 1355.

The market appears set for further declines after a brief recovery bounce and we expect a retest of 1322 this week.  A break of this level brings 1300 into play - below this 1280, 1250 and 1230 are the next support levels.

First resistance is at 1365, above this 1370, 1385 and 1400-1404 are the next resistance levels.

The dollar has broken out above resistance at 84 - we commented last week that this was a potentially important breakout with bearish implications for gold.  Oil continues to trade erratically, though with a downward bias, which is also bearish for gold.

Equities continue their powerful breakout rally and, although a correction at some point is inevitable, the bull market is alive and well in equities and is not yet showing any signs of fatigue.

Today's video for subscribers looks at last week price action in more detail and some longer term Fibonacci retracement targets for this decline.

Gold has been in a steep decline for the past few days, making a low of 1369 yesterday morning before recovering in the afternoon session to touch 1390.

Overnight, gold attempted to go higher still, though the selling has re-emerged this morning, pushing gold back down to 1375.  The market is in a clear downtrend and the April recovery rally now seems a distant memory - if gold cannot hold support at 1365, a retest of 1322 becomes the most likely scenario.

The dollar is moving higher again this morning after flirting with the 84 level yesterday - a break of 84 will be very bullish for the dollar and bearish for gold.  Oil is trading in a highly volatile range, though the trend is clearly down and a retest of $92 looks to be likely from here.

For all the conspiracy theories and unlikely explanations given by online commentators for gold's downward break through 1525 in April, it was clear to us that this move was a "game changer" for gold and further, possibly significant, declines are likely in the yellow metal.

We remain bearish whilst gold trades below 1525, with a bias to short into strength rather than buy weakness.

Today's video for subscribers looks at yesterday's trading in more detail and our strategy for our next trade.