Despite a rise in global stocks, gold prices appreciated to one-week highs just below $1,563 on Monday and remain close to the upper edge of the current trading range. Risk appetite remains elevated, with many global equities have been trading at record highs these days. Still, the precious metal remains afloat as some investors continue to express a cautious tone, citing the remaining trade issues between the United States and China after the signing of the phase one deal last week.
The yellow metal continues its recovery after an aggressive rejection from long-tern highs above the $1,600 handle which remains the key target for bulls these days. On the downside, the $1,535 area continues to serve as an important support now, with the key level comes around the $1,500 psychological level. In the short term, the bullion needs to hold above the $1,560 in order to retarget the $1,577 region.
In a wider picture, once investors digest the phase one deal, market optimism could wane gradually, which in turn will play into the hands of gold bulls. Besides, the major central banks continue to show their commitment to expansionary monetary policy amid the remaining economic weakness. In this context, the yellow metal will likely preserve its appeal as a safe haven in the medium and long term.