Gold is turning back from our 2nd tier uptrend line after the precious metal was unable to power through our 2nd tier downtrend line.  Gold continues to experience an odd, positive correlation with U.S. equities.  Despite Monday’s weakness, our 1st tier uptrend line is intact, and momentum is still in favor of the bulls.  Meanwhile, gold remains comfortably above the highly psychological $900/oz level. 

The performance of gold has been very unpredictable lately since it is difficult to decipher the driving force behind gains.  Could it be the fear of future in inflation in the wake of unprecedented amounts of quantitative easing, or are bulls riding on the fact that China is using the pressure metal as a way to diversify its reserves from the U.S. Dollar?  Regardless, the positive correlation with U.S. equities lives on.  Therefore, reference the S&P futures.              

Fundamentally we find supports of $908.37/oz, $905.98/oz, $903.59/oz, $905.98/oz, $903.59/oz, and $901.35/oz.  To the topside, we see resistances of $910.98/oz, $913.15/oz, $915.76/oz, $917.71/oz, and $920.75/oz. Gold is currently trading at $911.40/oz.

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