Gold is making the confirmation move to the downside we were looking for as the Dollar appreciates across the board. The USD/JPY is logging a large technical movement to the downside while crude drains towards $60/bbl. Additionally, the selloff in the S&P futures is picking up, trading beneath May lows.

All of these movements are negative indicators for gold due to positive correlations, and the precious metal is reacting as one would expect. Gold has dropped sharply since breaking beneath June lows as we anticipated. However, we still believe the precious metal should find some substantial support in the $890-$900/oz range due to the psychological and historical significance of the range.

However, how long the $900/oz psychological level plays out remains to be seen. Should earnings results and outlooks disappoint investors over the next couple weeks, we could be witnessing the beginning of a large downtrend.

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