Has the Yellow Metal Lost Its Luster?

Whether you're a gold bug, momentum trader, or you believe that the world is about to end, lots of people have their own rationale for owning gold. But with the recent price action of the last few months being nothing short of lackluster, where is gold set to go in the next few weeks and months?

I think the answer is inflation. Gold initially popped on the back of nontraditional monetary policy, which many thought would cause inflation. However, we haven't seen inflation at the levels that some were afraid of. Any increased fears of QE3 should drive gold higher. I personally feel as though gold will bounce up and down until the channel trend meets the support around $1525, where there will be a decisive move. From that consolidation, gold will either resume its long-term move higher or confirm a top in the market back in August.