Short-term bullish bias
Key levels: downside: 1292 / upside: 1300
Gold has seen robust support at the 1280 daily support. After last Friday’s upward momentum, the price is likely to rise further with a combination of new buying and profit-taking from sellers. The first target is near the 20-day MA (1310) as the averages start to cross.
On the 4H chart, the bullish MA cross is the first sign of a turn in the price action. The RSI has risen back from the over-sold territory, which confirms mounting buying pressure. On the hourly chart, we can see another bullish MA cross after a 4-day consolidation. The RSI has eased off from the 70 over-bought area. All indicators are pointing to a possible bullish reversal when the price breaks out of its triangle formation.
1300 is the immediate resistance and a break above could trigger an extended rally. On the downside, 1292 will be a meaningful support level to see whether buyers could keep up with the momentum.