Gold rises to over 3-month high, gains further beyond $1300 mark

Gold began 2018 on a firm note and built on its bullish momentum further beyond $1300 handle, with spot prices rising to the highest level in more than 3-months.

The precious metal gained around 13% in 2017, marking its best annual performance since 2010, and the up-move was primarily led by persistent greenback selling bias. With a loss of nearly 10%, the US Dollar posted its first yearly loss since 2012 and has been one of the key factors underpinning demand for dollar-denominated commodities - like gold.

Today's up-move was further supported by a sharp retracement in the US Treasury bond yields, which tends to benefit non-yielding yellow metal and a follow-through technical buying, especially after last week's closing above the key $1300 handle. 

In absence of any major market moving economic releases, the precious metal remains at the mercy of broader market sentiment surrounding the greenback and the US bond yield dynamics.

However, this week's FOMC meeting minutes and important US macro data, including the keenly watched NFP, would help investors determine the commodity's near-term trajectory. 

Technical levels to watch

Immediate resistance is pegged near $1315 level, above which the momentum is likely to get extended towards $1326 horizontal hurdle with some minor intermediate resistance near $1320 area.

On the flip side, $1303-02 zone now becomes an immediate support to defend, which if broken might prompt some profit taking slide towards $1295-93 horizontal support ahead of the $1287 region (100-day SMA).