Gold spikes to over 2-month tops, now eyeing $1300 mark

Gold moved higher for the third consecutive session on Friday and jumped to over 2-month highs, near $1295 region during the early European session.

A terrorist attack in Span boosted demand for traditional safe-haven assets and helped the precious metal to build on its post-FOMC minutes upward trajectory. Adding to this, a fresh wave of US Dollar selling interest, amid ongoing political drama in the world's largest economy, was also seen lending support to dollar-denominated commodities - like gold. 

Moreover, growing consensus that the Fed might not raise interest rates again in 2017, reinforced by the recent slide in the US Treasury bond yields, remained supportive of increasing demand for the non-yielding yellow metal. 

Meanwhile, possibilities of some stops being triggered on a move back above $1290 level might have also collaborated to the metal's sharp uptick over the past hour or so. 

The commodity is closer to confirming a fresh bullish break-out beyond yearly tops and hence, a strong follow through momentum, even beyond the key $1300 psychological mark, now seems a distinct possibility.

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Technical levels to watch

Momentum beyond $1300 immediate resistance could get extended towards $1307 level, above which the metal seems all set to aim towards US Presidential election swing highs resistance near the $1335-37 region. On the downside, any pullback below $1290-88 zone now seems to find support near $1285 level, which if broken is likely to accelerate the fall back towards $1280 area en-route $1273-72 important support.