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Think you had a tough week? Don't go complaining to gold. The yellow metal has declined by almost 5 percent since last Wednesday's high—and RBC's top technician thinks it's about to get even worse.
"We're sticking on the bearish side for gold prices," said George Davis on Thursday's "Futures Now."
Davis, the chief technical analyst at RBC Capital Markets, thinks little of gold's 22 percent rally from the June low. "You are seeing a little bit of a corrective rally, and I think a lot of that has been driven by geopolitical risks emanating out of Syria," Davis said. "But we do think that those are going to be transitory, so the very short-term risks are going to pass."
(Read more: Gold has become a 'Humpty Dumpty' trade)
That's why Davis says it's high time to get short. "Valuations are starting to become more overbought at this juncture," he said. "I think there's a window of opportunity where you could leg into some short positions."
So what does he see on the chart that points toward lower prices?
With Friday's all-important job number looming, stocks are likely to stay in a tight range. But bulls and bears alike still have the opportunity to make money.
Equities traded with bullish momentum early Wednesday, as they prepared themselves for the gauntlet of data. Momentum late in trading was supported by the Federal Reserve's Beige Book, which showed a "moderate to modest" expansion in spending.
After holding major support at the line in the sand on Tuesday—the 1,629.25 to 1,631.25 level—the S&P closed above the 1,645 to 1,647.50 pocket. And on Wednesday, the S&P finished above the crucial 1,650 level.
Gold sentiment has certainly turned around in recent weeks. The market had been very bearish, but that was before gold rose more than 20 percent from its lows—a development that had bulls chirping that gold's "bull market" is back.
But as we see gold futures oscillate around $1,400, gold now resembles Humpty Dumpty—and it is imperative that it lands on the right side of this psychological "wall" in order to maintain momentum.
The Syrian situation should prove supportive of gold, but only because the idea that gold is a safe haven has regained traction among investors.
Gold bulls shouldn't get too confident, because gold could lose that "flight to quality" feeling again.
(Read more: Gold will face a rocky week; here's why)
What would it be like to get one of the market's most famous contrarians on the therapist's couch? Viewers found out on Tuesday's "Futures Now," when host Jackie DeAngelis played the classic word association game with Dr. Doom himself, Marc Faber.
The game itself is simple. When presented with a word, the participant responds with the first word that comes to his head. It's thought to provide insight into the subconscious associations that people make, but it can also be a great deal of fun.
(Read more: Here's what Marc Faber likes more than gold)
Here, then, are the terms Marc Faber was provided with—and his responses.
If you want to hear a rosy view on the market, you'd better not listen to Marc Faber.
The editor and publisher of the Gloom, Boom & Doom Report has long held that a correction was coming—and even though that thesis has not exactly played out this year, he's standing by it.
"In my view, we'll go back to the lows in November 2012—around 1,343" in the S&P 500, Faber said. Overall, he considers U.S. equities a "better sell than a buy."
On Tuesday's "Futures Now," he provided three three main reasons for his bearish view.
Reason one: The U.S. will follow emerging markets down
It hasn't been an easy summer for emerging markets. In the period of a month and a half, the iShares MSCI Emerging Markets ETF (which tracks emerging markets' large- and mid-cap stocks) lost nearly 20 percent of its value and has hardly bounced back from the lows.
That has made the U.S. market an outperformer, but Faber believes it cannot last. In fact, he said, U.S. equities could be hurt by their relative costliness.
"When emerging markets go down and the S&P goes up, the asset allocators say, 'Do I want to buy the S&P near a high, or do I venture back into emerging economies that are down 50 percent from their highs, like India or Brazil and so forth?' So you understand that the pool of money can flow back into emerging markets," Faber said.
Marc Faber has been a gold bull for a long time. In January, he told
With the metal up some 20 percent from its June low, however, the editor and publisher of the Gloom, Boom & Doom Report is changing his tune.
"The sentiment on gold has recovered," Faber said on Tuesday's "Futures Now" show. "It is relatively bullish."
After all, "we had a big rally in gold already," he said. "I think we will ease back a little bit."
(Read more: Gold will face a rocky week; Here's why)
Instead of gold, Faber recommends considering another classic safe haven: Treasurys.
"I think the sentiment is incredibly bearish about Treasury bonds and Treasury notes," he said. If the market drops, "people will again fear deflation, and they will move into 10-year Treasury notes."
(Read more: Marc Faber: Look out! A 1987-style crash is coming)
With the Syria situation still up in the air, the sloshing in oil will persist.
We have seen a $4 range in the Tuesday morning session, as oil continues to be ubersensitive to the Syrian news that drips out every few hours.
President Barack Obama has required congressional authorization in order to proceed with an attack, and that has certainly increased the volatility in the market, as it has added another catalyst to an already unsteady situation. Indeed, there is still little clarity regarding what the regional or global response would be to a limited U.S. attack, or a "slap on the wrist."
Russia reported overnight that ballistic missiles were fired in the Mediterranean, which led to some concerns that a strike on Syria could be getting underway. These launches turned out to be Israeli missile tests, but the bottom line is that until the Syrian sideshow is behind us, we can expect continued volatility.
(Read more: Russia raises alarm over Israeli missile test)
Gold found itself sliding into the open on Sunday night of the holiday session, reaching a low of $1,373.60. The market stabilized quickly, and hugged the $1,391.80 lows from Friday for most of this long session.
Syria is the biggest story for the markets right now, and America's good cop/bad cop routine leaves gold searching for direction. In an environment like this, it is critical to keep an eye—or two—on the levels.
Gold was able to hold $1,401 through several tests Thursday, then traders pressed the market to an initial low of $1,392.50 early Friday morning. We found gold hugging our $1,395.20 level for most of the morning, before better-than expected final reading from the Michigan Consumer Confidence report dropped the market down to $1,391.80.
We have seen a "buy the rumor, sell the fact" mentality take over the gold market following Secretary of State John Kerry's dramatic speech Monday, and after a great deal of hustle-and-bustle, gold now finds itself back where it closed out last week.
(Read more: With Syria strike looming, you need to own gold)
Major support will come in at our $1,383 to $1,384.10 level, and a close below that will be bearish. In fact, it would likely signal a consolidation to the next major support level at $1,352, as we head into the all-important September Federal Open Market Committee meeting.
One thing is becoming clear at the end of August: The summer doldrums are over, and volatility is increasing big time.
It's not only the situation in Syria that is causing the increase in volatility. Congress is coming back, and that means the debate over the debt ceiling will heat up. Treasury Secretary Jack Lew said that if Congress doesn't act, the U.S. will reach the debt limit in mid-October. He then told CNBC that President Barack Obama will not negotiate over the debt limit.
(Read more: Lew: Obama not negotiating over debt limit)
But Republicans are already drawing a line in the sand. Some, like Sen. Ted Cruz of Texas, have said that they are willing to see a government shutdown unless Obamacare is defunded.
There is always a lot of big talk ahead of these increasingly common Washington crises, but the problem is, the market listens to it. So over the next few months, expect larger swings in the markets, and don't be surprised if the direction becomes increasingly hard to gauge.
So what does this all mean for traders and investors? My advice is three-fold.
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