Gold managed to sustain bullish momentum after bouncing off the $1270 area with a daily close which leads the price to currently reside above $1285 price area.
Gold entered a new phase of uncertainty on its role as the leading safe-haven asset, as markets seemed to prefer the US dollar as a hedge against the China-US trade war. Gold's direction in the coming week would be decided by May's replacement, and whether the candidate will continue pushing for Brexit. Markets are also paying close attention to the US Federal Reserve's next move, as a string of weak data from the US late last week promoted bets for a much-expected rate cut by the central bank.
The impetus for additional gains in gold prices depends mostly on how far Federal Reserve rate cut expectations can go. As a reminder, the central bank has reiterated its data-dependent stance. To that end, there are plenty of opportunities such as US consumer confidence and GDP data to impact the Fed's outlook on US economic growth prospects. While in the short-run this may support gold, gains in the highly-liquid US Dollar during times of aggressive risk aversion can counter this and should not be discounted. The reason why this is prominent is because of the increase in US-China trade war fears seen as of late.
The price is showing bullish sustainability with upward pressure while residing inside a Bullish Flag pattern which is expected to lead the price higher towards $1300 and later it might push further upward and take on the $1500 area in the future. As the price remains above $1265 area with a daily close, the bullish bias is expected to continue.
SUPPORT: 1265, 1276
RESISTANCE: 1290, 1300-10, 1500
BIAS: BULLISH
MOMENTUM: VOLATILE
