Gold got hammered on Thursday and is now testing the 1280 level once again. The metals are weak and show no signs of reversing the ugly trade anytime soon. We all know that markets never announce themselves and the metals could turn but they don’t look good.
After Monday’s short covering rally, which caught many off guard, gold reached resistance and has been coming down ever since. Once again Gold is getting close to a decision point and a breakthrough 1280 brings 1240 -1220 into play.
The current direction in metals is down and nothing will change that until the pattern changes. As we have written for weeks, gold is a sell at resistance and has a chance to breakdown completely. However, the price action is the key and Gold and Silver will find a bottom. The only question is when? Investors should hold tight and traders should be selling rallies.