Gold climbs closer to monthly high on safe-haven demand

Gold traded with positive bias for the sixth consecutive session and pushed to three-week tops on safe-haven demand.

Against the backdrop of gradual Fed rate-tightening cycle, broad based greenback weakness, with the key US Dollar Index hitting multi-week lows, has been a key factor pushing prices for the yellow metal higher in the past week. A weaker greenback tends to boost demand for dollar-denominated commodities - like gold. 

This coupled with a fresh wave of global risk-aversion, in wake of big overnight sell-off in the US equity markets, further drove flows towards traditional safe-haven assets and lifted the precious metal closer to monthly highs, near $1250 region. 

Investors this week will remain focused on comments from the Fed Chair Janet Yellen on Thursday in order to determine the next leg of directional move for the commodity amid lighter US economic docket. 

Meanwhile, uncertainties stemming out of the Euro-area, ahead of the French presidential elections, and Brexit, might limit any immediate downslide and support the metal's ongoing strong rally. 

Technical levels to watch

From current levels, monthly highs near $1250-51 area see to act as immediate resistance, above which the metal seems all set to aim back towards the very important 200-day SMA hurdle near $1260 region. 

On the downside, any retracement below $1244 level (session low) is likely to find support near $1239-38 region, which is closely followed by a strong support near $1234 level. Only a decisive break back below $1234 important support would now negate near-term bullish bias.