Nick Nasad
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Will Gold Bounce Down Off Channel Resistance?

The past 3 weeks of price action in gold has set up a downward sloping channel with a well fairly well defined resistance trendline. Gold now tests this resistance after a down and up week. Has the pair returned back to a neutral stance and should we expect further sideways action? Or, can we get a reaction from resistance and see the pair move back towards the lows set earlier in the week? Gold tends to move with a negative correlation with the USD, but that relationship has gotten slightly jumbled of late. 

If the weak USD theme continues then gold may move to the topside, however if USD strength can come back next week - let's say amid renewed taper talk - then the yellow metal may have another fall in store. As we can see from the 1-hour RSI its been in a downward trajectory with a test and hold of the 60 area implying that we could have a further downswing. 


- Nick