Gold maintains its bullish outlook as it resumes its upside momentum following a pause in the rally for a few weeks in May after rebounding from a low of 1214.17. There is scope to target the key level at 1300. Prices would have to pass the April 17 high of 1295.38 in order to confirm that a lower low is in place at 1214.17 (May 9 low) and to strengthen the bullish bias. A successful break above 1300 would open the way to the next resistance level at the November high of 1337.12.
The medium-term uptrend remains in progress as gold has been carving out higher highs and higher lows since rising from the mid-December low of 1122.66.
The RSI has picked up momentum and is rising after pausing in the month of May. Being above 50 in bullish territory suggests that there is room for further upside in gold prices. MACD has recently crossed above zero, giving a bullish signal.
Meanwhile, the bullish crossover of the 50-day moving average with the 200-day MA on May 17 supports the overall bullish outlook.
If prices fail to rise and instead decline from current levels, important support comes into view at 1240 and 1214.17. Below this, the market is at risk of changing the medium-term bullish trend to a more bearish one.
