Chartists Find Support, But...

...it's not at a level that inspires much confidence. Reuters reporter Jan Harvey asked a few technical analysts for the next support level and came up with a median of about $1.025.

Since higher support levels have been obliterated recently, two of them said that the next support level is around $1,000 - the level at which the November run started. Here's one:

Gerry Celaya, an analyst at Redtower Research, said from here a line taken between the lows of January 2009 and mid-October established support around the $1,026-1,030 zone....

"That whole area is now becoming more and more important as the next barometer of gold sentiment on a trading basis," he said. "If we go below $1,030-1,020, anybody who is hoping this is pullback within a broad channel would start to (rethink)."

"They would start to look to a retreat back into the low end of the trading range, around $980."

Complete erasure of that gain, from the end of October to the beginning of December, would establish it as a mini-bubble - and would not bode well for gold this year. Bubbles go back to where they were, and the asset's price doesn't go back up for some time.