Spot gold rose 0.7% to $4,635.39 an ounce, hitting its highest level since May 14. U.S. gold futures for December delivery rose 0.4% to settle at $4,697.80 per ounce.
“The fundamentals and technicals are kind of lining up bullish for the gold market here to start the trading week,” said Jim Wyckoff, a market analyst at American Gold Exchange. He also said that bond yields “have stabilized, even dipped a little bit today”, supporting the metal.
With prices trending higher, Wyckoff said the path of least resistance for gold “will continue to be sideways to higher” in the coming weeks, barring a technical reversal signal.
Gold broke above its 200-day moving average last week, further strengthening the upward price momentum.
Gold-backed ETFs also attracted inflows of 46.7 metric tons ($6.4 billion) last week, which was their largest weekly demand in 10 months, according to the World Gold Council, with North American and Europe-listed funds leading the inflows.
Bullion rose more than 5% last week after the U.S. Treasury Department’s buyback support plan pushed the dollar to multi-month lows, making greenback-priced bullion cheaper for foreign buyers.
Market focus is also on policy speeches this week in the U.S. and Japan.
Markets are awaiting the Federal Reserve’s favored inflation gauge, the Personal Consumption Expenditure price index, due on Wednesday and Chair Kevin Warsh’s debut speech at the Jackson Hole Symposium on Friday to gauge the outlook on interest rates.