Gold prices climb due to geopolitical tensions and increased purchases from China

Gold prices edged higher in early Monday trading, opening with a $10 gap up, driven by heightened geopolitical tensions and renewed demand.

Investor sentiment shifted towards safety as Syrian rebels seized the capital, Damascus, and gained control of the country, fueling uncertainty and supporting gold prices.

Adding to the bullish momentum, fresh demand from China played a significant role. The People’s Bank of China (PBOC) resumed gold purchases after a six-month pause.

The technical outlook on the daily chart showed improvement, although a clearer directional signal remains absent. Prices climbed toward the upper boundary of the near-term range at $2666, which aligns with the 50% retracement of the $2721 to $2605 bearish leg and is reinforced by the 55-day moving average (DMA).

Sustained bullish momentum and a rise above the 10- and 20-DMAs provided an initial positive signal. A confirmed break above the range ceiling would pave the way for further gains toward $2677 and $2693 (61.8% and 76.4% Fibonacci retracements, respectively) and the psychological level of $2700.

Maintaining a hold and closing above the 10-DMA ($2640) will keep the near-term bullish outlook intact, while a broader bullish bias would strengthen above the daily cloud base at $2630.

Res: 2666; 2677; 2693; 2700
Sup: 2640; 2630; 2613; 2605