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Which Way Gold is Heading?

(Gold : Hourly Chart)

The speculation on Fed increasing the interest rates or not still weighs on Gold prices. Last week Gold fell significantly and the decline was the biggest weekly decline since November on the prospect of an interest rate hike by Fed as early as 2015 strengthening US Dollar and fading the shine of Gold which is used as a hedge against Inflation. The demand from top consumer China also seems to decline because of weak Yuan and discounted prices on Shanghai Gold Exchange which as a result discourage imports. 

On the hourly chart, Gold was trading within a downward sloping channel trend. There was a key support level at 1321.35 which pair broke out just now, the next nearest support level the pair should find is at 1306.53 which can be seen on the daily chart given below.

(Gold : Daily Chart)A declined below the support level of 1306.53 could bring major losses to the pair.