Gold bulls losing their footingGold continues to struggle to regain its upside momentum. It was flat yesterday, and has drifted lower this morning. It is now trading back in a band of support/resistance around $2,630-$2,640. It doesn’t feel as if the selling pressure is over. While it could be exhausted if prices can maintain current levels, a retest of $2,600 cannot be ruled out. And a break below here would open up the probability of a drop back down to the lows from mid-November, around $2,530, or even back to late summer levels around $2,500. Such a move would be enough to persuade many that the bull market in gold is over, and that $2,790 will have to remain as the new all-time high. But it would also be an opportunity for a huge MACD reset which could provide a springboard for another run at $3,000 – a long time target for the bulls. We’ll see how things develop over the rest of this year. Meanwhile, silver has broken below the upward-sloping trendline that had been building since August. From here, it looks as if a retest of support around $30 per ounce is possible. Should this fail to hold, then there’s not much to hold up prices until we get closer to $28.
