Gold prices rose $6.36 on Monday, recovering a portion of last week's losses, as the U.S. dollar retreated after rising for 10 straight days. Yesterday prices initially fell but found support at around 1206 which became the low of the day and also triggered some kind of a move up. The XAU/USD pair is currently trading at $1217.79, slightly higher than the opening price of $1213.45.
The market has been under significant amount of pressure since the greenback’s strength made gold less popular but it seems that the lowest prices in more than five months attracted some players expecting a bounce. The intra-day key levels all remain the same as yesterday as the market remained within a relatively narrow range. To the upside, there are hurdles such as 1222/0 and 1230/28. The bulls have to push prices beyond 1230 if they intend to make an assault on the 1237 level which happens to be the bottom of the Ichimoku cloud on the 4-hour chart.
On the other hand, if the bears can defend their camp in the 1222/0 region and increase the downward pressure, then keep an eye on 1208/5. The bears will need to push prices back below 1205, so that they can have a chance to challenge the major support in the 1200-1197 zone. A successful break below 1197 could see a fall to 1171/69.
