Gold stable near 3-week tops, above $1300 mark

After an initial dip to $1301 level, gold regained traction and clocked fresh three-week tops during early European session on Monday.

The precious metal stayed above the key $1300 psychological mark turned positive for the seventh consecutive session, supported by safe-haven demand on escalating tensions between Iraq and Kurds. Baghdad moved troops into the oil-rich Kirkuk region after the Kurdish Regional Government mulled a push for independence.

Regional geopolitical tension seems to have been largely negated by the prevalent risk-on environment, as depicted by positive trading sentiment around global equity markets. 

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Moreover, a modest pickup in the US Dollar demand and an uptick in the US Treasury bond yields further collaborated towards keeping a lid on dollar-denominated/non-yielding yellow metal. 

Hence, it remains to be seen if the commodity is able to build on its up-move or stalls its recent recovery move from near two-month lows amid a combination of diverging forces. 

Technical levels to watch

Immediate resistance is pegged near the $1308-10 region, above which the metal is likely to accelerate the up-move towards $1323 hurdle with some intermediate resistance near the $1314-16 region.

On the downside, the $1300 handle remains immediate strong support to defend, which if broken might trigger a corrective slide towards $1290 horizontal level en-route $1284 strong support.