Gold is reacting negatively to the inflection point of our 2nd and 3rd tier uptrend lines.  The swift pullback in gold follows a week of tight consolidation, signifying investors are siding with the downside after a period of indecisiveness.

We believe today's movement to the south could be a game-changing statement with a retest of the highly psychological $900/oz likely.  Gold's pullback is discouraging for equity markets due to the positive correlation between the precious metal and the S&P futures.

The S&P is presently flirting with its own psychological 900 level, and gold could be leading the way for U.S. equities.  On a positive note, today's pullback hasn't been accompanied by abnormal volume thus far, so we will have to see how the session pans out.  However, gold's downturn certainly raises a red flag, and we wouldn't be surprised to witness another near-term leg down. 

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