After selling off for most of yesterday and testing the 1550 level again, gold received a boost overnight from news that the EU summit had come to some kind of agreement to assist Spain and Italy using bailout funds.

Gold is finding some resistance at 1570 and it remains to be seen how long the boost from the EU summit lasts.

There is significant resistance above with all of the moving averages and the 1600 round number, as well as the 1630 resistance area.

However the market is well supported in the 1525-1550 zone - something has to give eventually.

Little by way of update from yesterday's commentary.  Yesterday saw a "doji" candlestick on the daily chart. indicating indecision in the marketplace with no real direction this morning either.

We can see that there is a short term uptrend channel competing with the intermediate down trend channel, with critical support for the bullish case at the "double bottom" of 1558 and the major support at 1525-1530.

Any news from the EU summit may move the markets, though we do not expect much to come out of the meeting other than the usual talk.

Gold gave back all of the gains from Monday after failing to break through the 38.2% retracement level and is now trading in the mid-1560s.

The "double bottom" at 1558 is a critical hold here for the bulls and a failure of the support would see a rapid retest of 1525.  If the major support here fails, 1400 could be seen in very short order.

There is a lot of overhead resistance around 1600 with a cluster of moving averages and the psychological round number to contend with.

After finding support at 1558, gold moved in a narrow range throughout the day yesterday, before exploding higher once the top of the range was broken to the upside.

Gold hit a high of 1587, corresponding with the 38.2% Fib retrace of the move down, and has held the gains this morning.

We expect prices to move higher, though there is a lot of resistance overhead, particularly in the 1600 area.

Friday was a pretty quiet day after the fireworks on Thursday as gold attempted to stabilise after the big sell off.  After hitting a low of 1558, which could potentially be a "double bottom", gold recovered to 1570 and has remained there overnight and into today's trading session.

Whilst still very vulnerable to more downside, and with a huge amount of overhead resistance to overcome and rebuilding to do by the bulls, this stabilisation above 1550 is encouraging.

Today's video looks at our strategy for the week and a number of potential trades that may evolve. 

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As we commented in yesterdays update, gold looked to be ready to sell off and that is exactly what happened.

Once the market dropped below the 1590 support level from Wednesday evening, the sell off accelerated quickly and continued all the way down to 1560.

Whilst gold appears to have stabilised, at least temporarily, at 1560 and is attempting a recovery rally, there is still a significant risk of a retest of the 1530 support zone.

We closed our short trade yesterday at 1570 for a $55 profit on the expectation of some kind of bounce after the big sell off yesterday.

Today's video looks at potential downside targets and our strategy for our next trade.

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Gold drifted lower before the FOMC announcement and, while the statement was not the major market moving event that it sometimes has been recently, the lack of any fresh QE did mildly disappoint the gold market and the downward bias continued.  Our prediction of an extension to the Operation Twist securities trading programme was correct.

Gold appears to be heading lower, todays video looks at our targets for potential support.

We remain short from 1625 with our stop now at break even.

As expected, yesterday was a very quiet day of trading in gold.  After attempting to overcome the 1630 resistance area in the morning, gold spent the rest of the day with a slight downward bias and closed near the lows of the day.

Today's FOMC announcement could be a major market moving event, as discussed yesterday, and we expect muted trading in a narrow range until then.

We remain short from 1625 with a tight stop.