Spot gold moved above $1225 pivot (Fibo 61.8% of $1243/$1196) on Thursday after being congested in past few sessions and unable to close above despite strong upticks $1228/30).
Fresh rally was boosted by weaker dollar, but sustained break above $1225 Fibo barrier and $1227 (trendline resistance) is required to signal continuation of bull-leg from $1196 (11 Nov low).
Important factor that could boost gold price is increase of dissonant tones regarding Fed rate hike in Dec.
Comments from Fed top officials in past few days, pointing at rising concerns about global growth slowdown, which could impact US economy and the comments that the central bank may pause the rate hikes, diminish recent strong hopes that saw Dec increase as done deal.
Shift in rate policy may disappoint market expectations and prompt investors out of dollar which could offer fresh support to the yellow metal, however, more signals from Fed before Dec policy meeting is still required.
Technical studies are bullishly aligned on daily chart but still require stronger bullish momentum to underpin recovery. Close above $1225/27 pivots would generate bullish signal for extension towards $1232 (Fibo 76.4%) and would expose lower platform at $1247 and 26 Oct spike high at $1243. Conversely, repeated failure to close above $1225 would signal that bulls are running out of steam and would keep the downside vulnerable.
Res: 1230, 1232, 1237, 1243
Sup: 1225, 1222, 1219, 1215
