Gold rallies to $1350, highest since September on heavy USD selling
• Heavy USD selling remains supportive of the up-move.
• Reviving safe-haven demand provides an additional boost.
Gold continued gained bullish traction through the mid-European session and rose to its strongest level in more than 4-months.
A broadly weaker US Dollar, which extended its downward spiral after the US Treasury Secretary Steven Mnuchin's comments, remained supportive of the ongoing bullish run-up for the dollar-denominated commodity.
Adding to this, the prevalent cautious sentiment around equity markets, amid growing worries over a possible trade war, was seen benefitting traditional safe-haven assets and further collaborated to the precious metal's strong up-move to $1350 area, a level not seen since Sept. 8.
With the USD price dynamics turning out to be a key driver, investors now look forward to Thursday's key event risk - ECB meeting, for fresh directional impetus. The highly anticipated ECB decision might provide clues over the central bank's plan to end its massive economic stimulus program and eventually influence demand for the non-yielding yellow metal.
Technical levels to watch
Sustained move beyond $1350 level could get extended towards Sept. 2017 highs, around the $1357-58 region, above which the commodity seems to dart towards $1366 level en-route 2016 highs resistance near the $1375 area.
On the flip side, $1344-43 zone now seems to protect the immediate downside, which if broken might prompt some additional profit-taking slide and drag the metal back towards $1334 horizontal support ahead of $1326 level.
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
