Spot Gold accelerated strongly higher in early American session Monday, gaining nearly 1.5%, in the biggest daily rally since 24 Aug, driven by fresh safe-haven demand on rising concerns about Italy’s budget issues.
The yellow metal price surged through the base of thick daily cloud ($1191) which capped action in past three days and took out converged daily MA’s ($1197/98), to extend gains above psychological $1200 barrier.
Fresh rally also cracked barrier at $1203 (falling 55SMA), confirming fresh strong bullish stance.
Regaining strong safe-haven appeal after hawkish Fed inflated the greenback, could drive gold price higher to challenge key barriers at $1214 (28 Aug high) and $1217 (Fibo 38.2% of $1309/$1160 fall).
Bulls need confirmation on close above $1200 level to generate bullish signal for further advance.
Strengthening momentum studies, which made bull-cross and is about to break into positive territory, support scenario.
Broken converged 10/20/30MA’s now turned to solid supports ($1198/97) which are expected to contain potential dips and keep bulls in play.
Res: 1206; 1211; 1214; 1217
Sup: 1203; 1200; 1197; 1193
