Gold collapsed after dipping below our previous bottom-end support and the key psychological $900/oz level. Consequently, the precious metal seems to have made a commitment to the downtrend, which is reflected in the strength of U. S. equities.

Gold is finding some support around its 1/29 lows, and could see a little rally back towards $900/oz as investors take advantage of oversold conditions.

However, the damage has been done. The only hope for a recovery in Gold would be a complete reversal in U. S. equities and a return to panic concerning the economic crisis. With economic data stabilizing globally and stimulus packages kicking in, this seems like a long-shot in the near-term. Therefore, the downtrend is back in full swing and could pick up steam if the S&P futures break out again.

Investors will be keeping a close eye on corporate earnings this week and this should help determine the near-term path of gold. Fundamentally we see resistances of $881.57/oz, $884.10/oz, $887.21/oz, $890.64/oz, and $894.46/oz.

To the downside, we find supports of $877.02/oz, $873.74/oz, $870.47/oz, $866.11, and $862.30/oz. Gold is currently trading at $877.00/oz.

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