FXStreet reports that Benjamin Wong, Strategist at DBS Bank, notes that gold is at its best levels in six months as prices recover from March’s $1676 lows. The recovery is mindful of the strong confluence support zone of $1660-$1670 (April-June 2020 price congestion zones). With a near-term bullish double-bottom pattern evolving into another bullish pattern of a reverse head-and-shoulders, the onus is to buy tactical dips that would eye a sustained break of the 200-day moving average of $1850.

“It would take two hands to clap in unison for gold to stage further advances, beyond its current best showing in six months. Spot gold prices need to surmount the 200-DMA at $1850, and gold exchange-traded funds prices (GLD US) need to tick above the dropped down resistance line from last August’s 194 that would obliterate the key moving average resistance at 174.” 

“With a near-term resistance line that trails from $1874 easily taken out, it should imply that gold remains a buy-on-dips proposition, with the support pivot at $1798 worthy of a look.”

FXStreet notes that the shockingly disappointing US Nonfarm Payroll numbers last Friday firmly sent gold trading above $1800/oz for the second straight session. The next target on the upside aligns at $1,850, economists at OCBC Bank appraise.

“The $1800 handle now appears to be the new support level for gold and we expect buying interest for gold in the short term on the back of the poor labour market report from the US.”

“Such is the shock from the NFP report that we think gold may find buying demand in the short term.”

“Resistance expected at $1850/oz, which is the 200-DMA.”