Gold spikes to fresh 1-1/2 week tops, further beyond $1300 mark
• The prevalent USD selling bias continues to underpin the dollar-denominated commodity.
• Reviving safe-haven demand amid a slump in equities remained supportive of the up-move.
• A sharp intraday slide in the US bond yields provided an additional boost to the metal.
Gold built on its goodish intraday positive move and climbed further beyond the key $1300 psychological mark, to near two-week tops during the early North-American session on Tuesday.
A combination of supporting factors continued fueling the positive momentum for the second consecutive session and assisted the precious metal to build on its recent bounce from 100-day SMA, tested last Thursday.
The prevalent US Dollar selling bias was seen as one of the key factors underpinning demand for the dollar-denominated commodity, which coupled with reviving safe-haven demand provided an additional boost.
The US President Donald Trump's latest threat to slap tariffs on European goods - as retaliation for subsidies given to Airbus, dented investors’ appetite for perceived riskier assets and was evident from a slump in equities.
The risk-off mood triggered a fresh leg of a sharp intraday downfall in the US Treasury bond yields, which further benefitted the non-yielding yellow metal and collaborated to the strong intraday positive momentum.
It would now be interesting to see if bulls are able to maintain their dominant position or opt to lighten their positions as the focus now shifts to Wednesday's important releases of US CPI print and FOMC meeting minutes.
Technical levels to watch
Immediate resistance is pegged near $1309 level and is closely followed by the $1312-13 supply zone, above which the commodity is likely to aim towards challenging its next major hurdle near the $1321-22 region. On the flip side, the $1300 handle now becomes immediate support to defend, which if broken might accelerate the slide back towards $1288-87 support area en-route the $1285 region (100-DMA).