Gold has broken the trend its started in 2008 on the upside in recent weeks as shown in the chart below (Gold in USD, source: Boursorama.com)
Gold has now started a parabolic move, and is headed towards 2000 USD per ounce. This remind me of the run-up in Silver earlier this year, where Silver reached 50 USD per ounce before severely correcting. It has since then somewhat recovered.
Although I still think that in the long term, Gold is headed much higher until we get positive real interest rates and debt issues are resolved, in the short term, Gold could reach a psychological level such as 2000 USD and then correct somewhat (10% to 20%) before moving up again.
2000 USD (or just above) also corresponds to the top line of the trend started in 2001 (See chart below. Source: Boursorama). Please note that it is a logarithmic chart as such scale is better suited for longer periods of time.
Right now, it's difficult to see what could trigger a sell-off in gold. The recent margin requirement hike did not put much downward pressure on gold. On the 25-26 August 2011 (This week), the federal reserve will meet at Jackson Hole and many people expect them to announce QE3 (explicitly or in disguise) at that time. If it does not happen, and the FED clearly waits and sees, we could see a short term correction in Gold as QE3 (or equivalent) will eventually be implemented.