GOLD: Risk Of Further Recovery Develops

With GOLD halting its broader weakness to rally strongly the past week, the commodity faces the risk of further upside offensive. However, it continues to hold on to its medium term downtrend. This suggests that its present recovery could fade and turn it lower towards the 1,522/27 levels. A cut through here will call for further declines towards the 1,500.00 level. Price hesitation could occur here due to psycho level but if that level gives way expect Gold to decline further towards 1,478.05 level. On the upside, the risk is for it to recover further towards the 1,642.15 level. If this level breaks, further upside should build up towards the 1,670.70 level and possibly the 1,700 level. All in all, Gold continues to hold on to its medium term downside bias though recovering.