If Gold got smacked yesterday when shares were buoyant, we should expect it to fall even harder when stocks finally take account of the disaster shaping up in Europe. Yesterday’s plunge seriously damaged a crucial support at 1633.10, raising the odds that the bear cycle begun in early September from $1925 will eventually fall to 1459.40. A move to at least that low looks like about a 2:3 bet at the moment — a 60% shot. We’ll keep an open mind about this, but please note that it would take a thrust to at least 1832.50 for bulls to go back on offense on the daily chart. Achieving this even on the hourly would take a burst in the days ahead that is uncorrected between 1681.80 and 1728.00. The two external peaks that would be surpassed impulsively by such a move are highlighted in the accompanying chart.
