GOLD recovery hits new 2-week high but risk of stall exists
Spot Gold maintains firm tone and holding near two-week high at $1265, on Tuesday, following strong rally on Monday.
The yellow metal was lifted by weaker dollar on concerns about US tax reforms plan and ahead of US housing data, due later today.
Tuesday’s action is holding above broken pivotal barrier at $1260 (Fibo 38.2% of $1299/$1236 downleg) and eyeing strong resistance at $1267 (converged 20/200SMA’s) and break here could trigger fresh recovery extension towards $1275 (Fibo 61.8% of $1299/$1236).
However, risk of recovery stall exists as 20/200SMA’s are on track to form death-cross and slow stochastic is overbought on daily chart.
Initial signal of stall could be expected on return below $1260 while fall below 10SMA ($1253) would confirm reversal.
Res: 1265; 1267; 1275; 1280
Sup: 1260; 1253; 1250; 1244