Gold retreats after hitting new high at $1263

By FXStreet Gold broke above $1240 and jumped to $1263, hitting the highest level in a year. Price was rejected from above $1260 and pulled back. Currently is trading at $1245, away from the highs but holding $50 above yesterday’s closing price.

The yellow metal started to rise during the Asian session when it climbed above $1200 but then it continued to rally and peaked on American hours.

Dramatic rally in a risk-off scenario

From December lows, the ounce has risen two hundred dollars or almost 20% in an environment of financial tensions, a sell-off in stocks and expectations of a more gradual pace of normalization of monetary policy from the Federal Reserve. Also, since December, the Bank of Japan introduced negative interest rates and the European Central Bank signaled that it could cut the rate further.

The sharp recovery from multi-year lows in gold has pushed the price above key resistance levels. Currently is even significantly above the 100-WMA for the first time since 2013.
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Source:: FX Street