Investing.com - Gold futures rose to the highest level in nearly two weeks during U.S. morning hours on Tuesday, as a bout of technical buying kicked in after prices broke above a key resistance level.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1,593.10 a troy ounce during U.S. morning trade, up 0.95% on the day.
Prices rose by as much as 1.1% earlier in the day to hit a session high of USD1,596.70 a troy ounce, the strongest level since February 28.
Gold prices were likely to find support at USD1,554.80 a troy ounce, the low from February 21 and near-term resistance at USD1,602.20, the high from February 28.
Gold's gains accelerated after breaking above a key technical resistance level close to the USD1,586-level, triggering automatic buy orders amid bullish chart signals. The sharp advance also prompted some light short-covering.
The precious metal had traded in a tight range of roughly USD1,560 to USD1,586 a troy ounce since the beginning of March.
Gold prices were also boosted as the U.S. dollar moderated some of its gains against its major counterparts. The dollar index was down 0.1% to trade at 82.73, erasing an earlier advance of as much as 0.3%.
Dollar weakness usually benefits gold, as it boosts the metal's appeal as an alternative asset and makes dollar-priced commodities cheaper for holders of other currencies.
Meanwhile, investors continued to speculate whether global central banks will continue to provide stimulus measures.
Expectations of monetary stimulus tend to benefit gold, as the precious metal is seen as a safe store of value and inflation hedge.
Investors were looking ahead to U.S. data on retail sales on Wednesday to determine the durability of the economic recovery.
Moves in the gold price this year have largely tracked shifting expectations as to whether the Federal Reserve could bring quantitative easing, one of the biggest boosts to gold’s bull run, to an end this year.
While the precious metal’s investment appeal has been dimmed in recent weeks, concerns over the global economic outlook remain after Chinese data released over the weekend showed consumer inflation accelerated sharply in February, while industrial production slowed to the lowest level since October 2009.
Fears over a possible economic impact from the U.S. sequestration spending cuts and last month's election deadlock in Italy also was likely to remain in focus.
Elsewhere on the Comex, silver for May delivery added 1.2% to trade at USD29.19 a troy ounce, while copper for May delivery jumped 1.3% to trade at USD3.562 a pound.