Gold spikes to fresh multi-day tops, above $1315 level

   •  The post-FOMC USD retracement prompts short-covering move.
   •  Sliding US bond yields/reviving safe-haven demand supportive. 
   •  Technical buying above $1313 provides an additional boost.

Gold built on its recovery move from the very important 200-day SMA and spiked to fresh multi-day tops in the last minute.

The post-FOMC US Dollar retracement slide, which tends to underpin demand for dollar-denominated commodities - like gold, triggered the initial leg of recovery move during the Asian session. 

Adding to this, retracing US Treasury bond yields provided an additional boost to the non-yielding yellow metal. Moreover, the prevailing cautious sentiment around European equity markets also supported the precious metal's safe-haven appeal and collaborated to the recovery move.

Meanwhile, the latest leg of a sudden spike over the past hour or so could also be attributed to some short-covering, following a decisive break through $1313 supply zone. Hence, it would be prudent to wait for a strong follow-through buying before confirming that the commodity might have bottomed out in the near-term.

Traders now look forward to the release of US ISM non-manufacturing PMI for some short-term impetus but the key focus would remain on Friday's US monthly jobs report (NFP), which is known to drive sentiment across global financial markets.

Technical levels to watch

From current levels, the recovery movement is likely to get extended towards 100-day SMA barrier near the $1322-23 region, above which the commodity seems all set to head back towards challenging the $1330-32 supply zone. 

On the flip side, any retracement back below $1315 level now seems to find immediate support near the $1310 area, which if broken might negate positive bias and turn the metal vulnerable to head back towards retesting 200-DMA support near the $1303-01 region.