Is Gold About to Break?

It's been another long week for precious metal bulls, with gold falling below USD $1150oz. A somewhat hawkish sounding Janet Yellen, combined with relative calm as regards the ongoing drama in Greece were enough to further dent the outlook for gold, with the metal now dangerously close to falling through USD $1140oz. So far that level has been the floor in this corrective cycle, but if it fails to hold this time, we wouldn't be surprised to see a relatively swift move back into the USD $1,000oz - USD $1,100oz range, whilst sentiment, which is already terrible, will only worsen. Weakness in the AUD has supported prices for local investors, with gold still up YTD, currently trading just below AUD $1550oz. Whilst we can't help but be concerned about prices short term in USD, we expect currency movements will continue to mitigate losses for investors in Australia, and remain confident that AUD $1,400 (a roughly 10% fall from here) is a likely worst case scenario for existing investors, and best case scenario for those looking to go long. (VIEW LINK)