Gold recovered its shine, with spot erasing all of its Friday’s losses and advancing up to a daily high of $1,235.87 a troy ounce. The decline in stocks favored the commodity, with strong buying interest coming from China, in the form of bargain hunting. Also, supporting the bright metal was dollar’s weakness, which traded lower against most of its major rivals.
Gold spot ended the day around $1,237 an ounce, recording a 1.19% gain on Monday and over 10% over the month.
Gold technical outlook
“From a technical point of view, the bullish stance prevails, as the price recovered strongly after testing a bullish 20 SMA early Monday, currently a strong dynamic support at 1,216.50. In the same chart, the technical indicators have erased all of their overbought readings, and the Momentum indicator turned lower around its mid-line, still unable to confirm further gains,” said Valeria Bednarik, chief analyst at FXStreet. “In the shorter term, the 4 hours chart, the technical picture is neutral, given that the price is hovering around a horizontal 20 SMA and the technical indicators head nowhere around their mid-lines”.
Support levels: 1,226.10 1,216.50 1,202.05. Resistance levels: 1,242.30 1,251.90 1,260.00.
(Market News Provided by FXstreet)