The RSI is deeply oversold on the daily chart and a short term bounce is likely from here, however we expect the decline to resume once the voersold condition has been unwound.
We are approaching the "summer doldrums", where the gold price tends to trade quietly with a slight downward bias and with gold near yearly lows, a return and retest of 1180 looks likely. The unfolding breakout in equities and continuing dollar strength also suggest that further pressure is likely in gold over the coming months.
Support can be found at 1250-1255, 1237-1240, 1220-1225, 1210, 1200 and 1180. A break of 1180 would have serious bearish implications for gold and suggest a decline to 1000-1050 in the short term - this prospect now looks more likely and the break below 1250 gives us confirmation of a likely return to 1180.
Resistance can be found at 1260, 1268, 1274-1277, 1283, 1289, 1293-1296, 1304-1305, 1309, 1314-1315, 1319-1322, 1330-1332, 1340-1342, 1352-1354, 1392-1395, 1400, 1420 and 1435. The failure to break above the 65 week MA suggests that the intermediate down trend remains in play.
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