Spot gold prices have recovered from a spike corrective low at 1681 to around 1713. This is right below a key resistance plateau that could be construed as the "neckline" of a week-long minor but meaningful head-and-shoulders topping pattern.

Inability of spot gold to claw its way above the neckline and right shoulder resistance zone at 1714 to 1726 in the upcoming hours increases the likelihood of another loop down that tests and breaks 1681 on the way to the 1660 support area thereafter.

Given the continued similarity in the pattern and timing structure of gold and the e-mini S&P 500, the above-described scenario will negatively impact the e-SPZ as well. ETF traders will want to keep an eye on the SPDR Gold Shares (GLD).

By Mike Paulenoff

Mike Paulenoff is author of MPTrader.com (www.mptrader.com), a real-time diary of his technical analysis and trading alerts on ETFs covering metals, energy, equity indices, currencies, Treasuries, and specific industries and international regions.

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