Gold sticks to gains near multi-year tops, around $1410 region
- Adds to the post-FOMC upsurge and remained supported by persistent USD selling bias.
- Escalating geopolitical tensions in the Middle East further underpin the safe-haven demand.
- Overbought conditions warrant some near-term consolidation amid empty economic docket.
Gold edged higher through the mid-European session on Monday and is currently placed at multi-year tops, around the $1410-11 region.
The Fed, in its latest monetary policy update last week indicated that it could cut interest rates by the end of this year to support economic growth and combat subdued inflationary pressure, which eventually turned out to be one of the key factors driving flows towards the non-yielding yellow metal.
This coupled with heightened geopolitical tensions in the Middle East - especially after Iran shot down an American surveillance drone, provided an additional boost to the precious metal's relative safe-haven status and remained supportive of the ongoing positive momentum.
Meanwhile, bullish traders seemed unaffected by improving global risk sentiment, as depicted by a positive mood across equity markets, rather took cues from the prevailing US Dollar selling bias which tends to underpin the dollar-denominated commodity.
However, extreme oversold conditions on the daily chart might hold investors from placing any aggressive bullish bets and warrant some near-term consolidation before the next leg of a directional move and absent relevant market moving economic releases.
Technical levels to watch