Gold could be facing a bumpy road ahead in the short-term

Gold could be facing a bumpy road ahead in the short-term, according to VTB Capital analyst Andrey Kryuchenkov.

In comments made to Reuters, Kryuchenkov said that European policymakers “need to convince the market that the crisis can be contained.”

With respect to gold, it “is trading completely against the dollar, moving in the opposite direction … and the physical side of the market is very quietly waiting on the sidelines for a pullback to start buying,” he contended.

“Gold could have a knee-jerk reaction,” Kryuchenkov added, “especially if there is disappointment with the meeting today.”

As for specific gold price levels to keep in mind, Kryuchenkov pointed to $1,680 as a critical support area. If the yellow metal fails to hold $1,680, he predicted that gold could suffer a quick decline to $1,600 per ounce.