Gold broke through critical support of $1180 & has held for 24 hours, however I am let to be convinced this is not a false break. It did this in Dec 2013 & bounced over $200. Perhaps a similar bounce is asking a bit much, although the more recent bounce to $1250 was despite the strength of the USD. What if we see the USD pull back? Its been trading what I would call as parabolically in the last few trading sessions, always a warning sign for me. Equity markets similar & they seemed to stall overnight. Perhaps just taking a breather, but it reminds me of similar times in recent months when equities have just nudged new highs only to plunge.
Gold equities also capitulated in the last few days, but not more than we saw yesterday with this trader stopped out. So I'm a sure there will be a few licking their wounds, so if there is a recovery it may be tentative for a start. However a break back above $1180 could spark short covering & a surge higher.
Many could legitimately argue that this is just a breather before we head lower still.
IMO once a key level is broken it needs to be carried on with sharply as it leaves specs exposed (shorts).
I have been hearing Asian buying stepped back a week or two ago & the thought was that (from a bank) that the demand is there its just being patient as the buyers could see better levels coming & that those levels have now been delivered.