Gold: Short-term price activity is still weakening from resistance at 1800. This may start to weigh on the constructive recovery that we have seen over the last few weeks, following Gold's dramatic 20% capitulation.
Speculative (net long) flows remain a concern having recently breached a key downside level which may threaten over 2 years of sizeable long gold positions.
There is heightened risk for a much larger decline if we confirm a weekly close beneath $1600/98 and $1530 (200-day MA/swing low), which has not been breached in 3 years!
A number of "bargain hunting" trend-followers will be watching this benchmark "line in the sand" for repeat support or a potential big squeeze lower into $1300 and perhaps even $1040-1000. Remember, this would still offer a unique buying opportunity in the near future.