5/5/2016, After failing to close above psychological resistance at $1,300 for two days in a row, gold has now backed off the key level and has made lower lows for three consecutive days. Besides the technical failure, weak physical demand and the USD gaining ground against a basket of currencies has spurred steady selling in gold this week. The China Gold Association stated that Chinese gold consumption in the first quarter of 2016 fell 3.91% versus the same quarter last year. GFMS reported that global physical gold demand in the first quarter declined 23.8% year on year, dropping from approximately 33 million ounces to 25 million ounces. Most notable within this was India which had Q1 physical purchases decline by 65%. Physical demand was clearly not the only factor for gold though to kick off the year though. Gold rallied 22% in the first quarter so the lack of physical demand, predominantly in Asia, was not a major factor in gold’s strength. ETFs added over 10.5 million ounces in Q1 and gold started to attract safe haven bids again as the markets became tumultuous. Support in gold for now is coming in at the low of today of $1,270 while resistance is firmly entrenched at $1,300.