The bullion has managed to stay above the significant support of its 200-day moving average, trading slightly higher on Monday as the USD has continued to weaken broadly.
Earlier today, German inflation numbers came out hotter than expected, with the yearly CPI print at 7.9%, up from 7.4% previously and 7.6% predicted.
At the same time, the HICP index also rose more than projected, coming out at 8.7%, up from the 7.8% predicted.
China sends markets higher
Elsewhere, after a week of progressively dropping case counts, authorities in Beijing claimed the COVID-19 epidemic there was likewise under control
, boosting risk assets globally.
“Risk is back in business, it seems,” said AJ Bell investment director Russ Mould. “A reopening of key economic hubs in China and suggestions the US Federal Reserve might slow the pace of interest rate hikes are helping to boost sentiment, at least in the short term.”
Price action seems neutral
It looks like the bullion lacks any momentum as it has moved nowhere over the previous week. On the other hand, as long as it trades above the 200-DMA (the purple line) at 1,840 USD, the outlook seems bullish.
We could see another leg higher toward previous highs of 1,875 USD if the greenback continues to decline at the current pace.
Alternatively, if the price drops below 1,840 USD, it might hit stop-losses of long positions, likely causing further losses toward 1,800 USD.