Gold Price Analysis: Bulls eyeing a move towards retesting multi-year tops

• Gold attracted some dip-buying and jumped to over one-month tops in the last hour.
• The set-up remains firmly tilted in favour of bullish traders amid renewed USD selling.
• The commodity seems all set to surpass multi-year tops, around the $1765 region.

Gold reversed an early dip to the $1743-42 region and jumped to fresh monthly tops in the last hour. The emergence of some dip-buying comes on the back of Friday's decisive break through a key hurdle near the $1730 supply zone and supports prospects for additional gains.

The near-term positive outlook is further reinforced by the fact that technical indicators on the daily chart maintained their bullish bias and are still far from being in the overbought territory. Hence, a move beyond multi-year tops, around the $1765 region, now looks a distinct possibility.

A mildly positive tone around the US equity markets was largely offset by a broad-based USD weakness. This, in turn, supports prospects for an extension of the positive move for the dollar-denominated commodity amid growing worries over a surge in new coronavirus cases globally.

On the flip side, the $1744-42 region now seems to have emerged as strong support and any subsequent slide might still be seen as a buying opportunity. This should eventually help limit any deeper losses for the commodity near the $1730-32 strong resistance breakpoint now turned support.

That said, some follow-through weakness might negate the bullish bias and prompt some technical selling. The yellow metal might then drift back to intermediate support near the $1721 region before eventually dropping to the $1700 round-figure mark.

Gold 4-hourly chart

Technical levels to watch