As shown on the chart, the pullback has finally begun in earnest for gold's quest to establish a higher low.
The million dollar question is how far and how long it lasts.
We suggest that the $1240 area is a good place to look for some reaction.
Below that is the 20 day simple moving average (middle bollinger band) and the 38% Fib retracement.
We still maintain our view that the Federal Reserve will have considerable difficulty hiking interest rates in June despite their rhetoric.
Nevertheless, once the FOMC date comes and goes we anticipate higher gold prices are on the menu as Central Bankers flounder about trying to fix a high debt problem with more debt.
We expect the next few months to be wildly choppy for both precious metals and the general market.