Gold moved sharply lower yesterday after days of indecision. Coupled with the break of the support at 1269, a further short-term decline is likely. A support stands at 1238. Hourly resistances can now be found at 1284 (21/05/2014 low) and 1304 (22/05/2014 high).

Longer term, we are sceptical that the horizontal range between the strong support at 1181 (28/06/2013 low) and the major resistance at 1434 (30/08/2013 high) is a long-term bullish reversal pattern. As a result, a decline towards the low of this range is eventually favoured.

Daily Technical Report