The price has drifted back to 1254 this morning in quiet trading due to the Martin Luther King holiday in the US, with equities flat, oil down a little and the dollar holding the key 81 level.
The environment remains challenging for gold, with the strong dollar capping the recent gold rally and the continued rally in equities drawing investment funds away from gold and commodities. The weak oil price signals a subdued inflationary environment and, with rising interest rates, gold is bound to find the going tough.
We suspect gold has made a high for this rally at 1262 and we anticipate a retest of 1180 in the next few weeks.
Support can be found at 1250-1255, 1237-1240, 1220-1225, 1218, 1214, 1210, 1200, 1190, 1188 and 1180. A break of 1180 would have serious bearish implications for gold and suggest a decline to 1000-1050 in the short term.
Resistance can be found at 1268-1270, 1277-1280 and 1291-1295. A break above 1268 would suggest an end to the short term down trend, though it would take a break of 1300 to suggest a more significant rally was developing.
Today's video for subscribers looks at the recent trading in more detail and our thoughts for the next few weeks of trading.