Excellent rally on gold

Risk aversion has caused a flight to safety and that is why we have seen strong rallies on gold and other safe haven assets. The precious metal has broken above the high on the 1274 level as shown on the daily chart and it is getting closer to the high at the 1281 level. The rally may continue even above those levels if risk continues to rise in the international financial markets or if the US Dollar goes back to its bearish trend due to the inverse relationship that there is between the greenback and gold. Above the 1281 level, the next resistances could be the high at the 1295 level, but a better resistance zone could be the 1300 level. To the downside, the 200 week EMA at the 1254 level could act as support and below that level the 200 day EMA at the 1244 level could also act as support. Another possible scenario that may develop is a consolidation between the 1274 level and the 1281 level.