Gold Hits Fresh 7-Week High, What’s Next?

Gold prices surged strongly during London trading hours, with spot gold reaching $1,169.04 a troy ounce, a fresh 7-week high.

The commodity extended its advance on speculation the US Federal Reserve will maintain its rates at record lows for the rest of this 2015, whilst a weaker dollar is also supportive of gold.

The commodity has eased some from its highs, but closed the day above the 1,160.00 level, which maintains the bullish trend in place. Daily basis, the has extended further above its 20 and 100 DMAs, while advancing briefly above the 200 DMA, before closing the day a few cents below it.

In the same time frame, the technical indicators recovered their bullish slopes above their mid-lines, supporting additional gains for the upcoming sessions.

Shorter term, the 4 hours chart shows that the price is well above a bullish 20 SMA, whilst the Momentum indicator heads higher well above its mid-line, and the RSI indicator hovers around 64, also supporting a continued advance, particularly if the price holds above 1,150, a key psychological support.

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