As I expected, gold found short term support at the black trendline, defined in my previous post. Now, if this trendline will hold or not is everyone's guess. Gold may consolidate and break out or violate the trendline and search for support lower. I don't want to make any bold predictions right now. Let's just wait and see if gold can sustain a pattern of higher lows.
The stock market doesn't look too healty also. Black resistance line on Dow Jones got touched only once and then price quickly fell off and never came close to it. I guess lows at around 10600 will be breached soon and then it should only be a matter of time before market plunges another 10 to 15%. A logical technical support for Dow Jones lies at arround 9000, but I wouldn't bet on it. The main point is that with virtually no stocks setting up and leaders selling off into strength it looks like the stock market will need at least two more serious 10 to 20% drops before prices become cheap enough for smart money to start accumulating. The only reasonable position right now is cash or mildly short exposure.
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