Expect gold to bounce when it retests April's low for the first time. But after that, there could be more trouble.
Gold opened up much lower on Sunday night, as metals took a beating once again. Silver was down as much as 8 percent, dipping to $20.25. Gold tested our next major support level, putting in a low at $1,336.30.
(Read More: Gold Heads for Longest Slide in Four Years)
Since the open, things have stabilized. Gold has reached back above $1,350, testing the electronic close from Friday, although still down more than $10 from the marked floor close. Silver has erased much of its losses, but is still down sharply on the day.
Much of this choppiness can be attributed to
Look for the prior $1,335.60 low to act as a major support now, but note a retest will likely send this market lower, with less emphasis on the $1,321.50 April low. The next major downside level is $1,283.50, but as we have previously mentioned, a close below that could potentially send this market down to $1,154.