Gold Mid Week Update -- Wednesday

I've expanded todays chart so you can get a better view of the technical action. In this view--we see two trendlines meeting ---- the downtrend and uptrend line. NOTE how gold has traded right in between these two lines all day so far on Wednesday. The 1406-1409 area is the key at the moment ---- if we can get a close above that area ---- then the potential to neutralize the downtrend and attempt a move back towards 1420-1425 would come in play. Until we close above that DOWNTREND DOTTED line ---- the market can still drift lower. Yesterdays spike low is the key at the moment ----- support is the 1385-1390 area for Wednesday ----and 1406-1409 resistance. We expect price to trade for most of the day near the two intersecting lines. Plunge support ----should it happen lies at 1365-1377 today. As you can see ---- this area is important for price support ---------esp where the dotted trend lines meet. This is where the market should make its short term decision as to higher or lower. For now --- watch for a close above the downtrending dotted line for the first signal of a rally attempt. Until then --- its best to remain cautious until price tips its hand or the Japan situation improves.

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