Gold headed back to 6-month tops near 1280 amid fresh USD selling

• Risk-aversion in European markets, broad USD weakness boost the gold bulls.
• Looks to regain 1280 barrier; technical set up points to further upside.

Gold (futures on Comex) found fresh bids once again near the 1269 level, prompting a fresh rally in the European session, as the bulls yearn to reclaim the 1280 barrier.

The main catalyst behind the latest bounce in the yellow metal is the renewed US dollar selling across the board. The greenback was dragged lower by a renewed risk-aversion wave that gripped the European markets alongside the US equity futures and Treasury yields.

The benchmark 10-year Treasury yields are down -1.10% below the 2.77% mark, offer some fresh trading impetus to the non-interest bearing and traditional safe-haven gold.

Gold prices jumped to fresh 6-month peak at 1282.30 in the US last session, as the risk sentiment was dented by rising US political worries amidst the US government shutdown and President Trump’s criticism of the Fed.

Technically, gold appears poised for a test of the 1300 mark heading into the New Year, in response to looming global growth concerns in 2019, geopolitical uncertainties and the US partial shutdown over the border funding.

Gold Technical Levels