Gold spiked to one-month tops during late American session, with bulls now eyeing a follow-through momentum beyond the key $1300 psychological mark. After an initial dip to $1282 area, the precious metal witnessed a dramatic intraday turnaround and caught some aggressive bids in reaction to China's announcement to impose retaliatory tariffs on $60 billion worth of US goods. The news added to growing fears about a full-blown trade war between the world's two largest economies, which dented the already weaker global risk sentiment and underpinned the precious metal's relative safe-haven status. Meanwhile, the ongoing slump in the US Treasury bond yields, amid the global flight to safety, also did little to provide any respite to the USD bulls or hinder the non-yielding yellow metal's upsurge to the $1300 neighborhood.
Gold prices surged during yesterday's session after breaking above the trend line presented on the chart to reach the $1300 level area. The price is currently retreating a bit with the $1298.5 support level being tested after the yellow metal entered the overbought zone. The momentum is still bullish and we will keep focusing on the upside with the $1304.67 on our watch.
Support: 1282.19/ 1280.11
Resistance: 1285.35/ 1288.35