Gold prices were reversing last week's bearish close as investors' concerns over global growth take a grip following the IMF's stark warnings and what appears to be a mixed picture when it comes to US-China trade relations progress. The IMF's Chair Christine Lagarde added that a high level of economic risks is emerging around the globe and cited Brexit and China's slowing economy as the main culprits along with the trade war. On the other hand, the Dollar retreated from its safe haven highs during yesterday's session, losing its appeal due to the US government being on its 29th day of partial shutdown and weaker US yields that are relieving the pressure for the yellow metal.
As expected, the flag presented on the chart turned out to be valid as the price bounced up after having received support from the lower band. The price is now consolidating just below the $1285 level with a good momentum and we expect the rally to continue all the way up till the $1291 level which will be the level we will be watching over the next 48 hours.
Support: 1282.19 / 1277.18
Resistance: 1287 / 1291.83