Gold failed to close above our near-term downtrend line on the 4-hour and are weakening back to the psychological $950/oz area as investors away in the U. S. government's plan to deal with toxic assets.

The correlation between gold and equities is a mess, and it will be interesting to see how the two interact in the near-term. Regardless, we're going to stick with the precedent that gold ultimately has a negative correlation with equities.

However, we're approaching precious metals with a wait and see attitude since America's use of quantitative easing is changing the layout of the playing field. That being said, there's the possibility gold could exhibit a negative correlation with the Dollar as America's currency loses its status as a safe haven. Even though the precious metal failed to close above our downtrend, it remains above our 1st tier uptrend line while hugging the 2nd tier.

Hence, gold is holding onto its uptrend for the time being even if we witness some more near-term profit taking. Fundamentally we maintain our resistances of $951.43/oz, $955.34/oz, $959.90/oz, and $962.51/oz.

To the downside, hold our supports of $948.17/oz, $945.88/oz, $942.62/oz, and $940.67/oz. Gold is currently trading at $950.20/oz.

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