Gold [XAU/USD] remains bid in Asia above $1290 amid risk-off in the markets and due to the debt ceiling uncertainty in the US.
Currently, the yellow metal trades around $1294/Oz levels. Prices fell to $1276 on Friday, the lowest level since August 16, before ending the week on a positive note at $1291.13.
Multiple Intraday highs above $1290
The metal first jumped above $1290 on August 11 and since then has posted multiple Intraday highs above the same. On August 18, the metal clocked a high of $1300 only to end the day on a weaker note at $1284.38 levels.
On the daily chart, we see steady higher lows; however, spikes above $1290 have been short lived. Thus, it feels like $1300 is so close yet so far.
US debt ceiling could yield rally above $1300
Trump’s inability to get things done on the debt ceiling front by mid-October could lead to US government shutdown and send shockwaves across the globe. The resulting risk aversion could easily yield strong rally above $1300 levels.
Gold Technical Levels
A break above $1296 [June high] would expose $1300. Multiple daily closes above the same could yield a sustained rally to $1337 [Nov 2016 high]. On the downside, breach of support at $1291 [5-DMA] would open doors for a pull back to $1288 [10-DMA] and $1285 [1-hour 200-MA].
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