Just last September 2011, gold (XAU/USD) reached a new all-time high of just above 1,900.00 US dollar per ounce. Investors’ hedging against capital losses due to the economic risks in Europe and the US was the primary reason of this ascent. This past several days, however, gold has slipped sharply.
After ranging for a while between $1,700 and $1,750 two weeks ago, gold has suddenly slipped past the $1,700 support all the way below $1,600 in just a matter of 3 days. Despite this, it appears though that gold’s long term support is keeping it afloat. As you can see from its chart above, its recent slide drove it down smack right at its primary uptrend line. This line, in my opinion, should hold. And if it does, a rebound in gold price could be seen soon. Revisiting the $1,800 level and even back to its all-time high. A break, however, of its long term support could send it down further to $1,500 or even to $1,400.