Gold prices extended declines last week but price action was seen reversing some of those losses by Friday’s close.

Overall, gold prices were seen consolidating near 1328 handle for the most part of the week.

We expect to see further near term declines coming in the short term outlook for gold.

The immediate downside target comes in at the previous lows that were formed at 1303 level.

The consolidation in gold prices could however continue into the week ahead as the markets start to position itself ahead of the FOMC meeting which due in two weeks time.

We expect to see gold prices consolidating and eventually breaking out to the downside as a result on a possible Fed rate hike.

There is a minor risk that in the event the Federal Reserve does not hike rates at the March meeting, gold prices could see an upside risk.

From a technical stand point, expect gold prices to revisit the 1303 level which was only testing but price action pulled back quite strongly.

We expect to see a stronger test of support near this level.

In the event of a break down below 1303, then we anticipate that gold prices could fall toward the 1282 – 1274 level of support which is also pending a retest after this price level initially served as resistance.