The gold chart is interesting: - Two.....>

GOLD TECHS: The gold chart is interesting:

- Two key Japanese candlestick patterns have developed recently. They suggest

the yellow metal is heading lower.

- On Jan 8, a significant shooting star reversal was confirmed (inverted

hammer). This pattern signaled bullish sentiment had run its course and that the

risk was for weakness near-term.

- Yesterday, prices traded lower and the pattern that has formed is a bearish

engulfing reversal. This signals an end to the recent Jan 14 - Jan 27 recovery

and suggests a higher likelihood bearish conditions will prevail near-term.

Yesterday's development reinforces the importance too of the Jan 8 pattern.

- If correct, the patterns suggest gold is likely to head lower towards the key

support area around $1536.0, Jan 14 low.

- It appears clear though that if risk aversion spikes once again, we will

likely see these patterns negated with gold rallying.

- However, for those that feel gold will weaken, recent candles are encouraging.

- A clear short-term risk parameter for bears has been defined at $1588.7.