• Gold prices recover from immediate support line, 50-day SMA.
• 21-day SMA, 13-day-old resistance line guard immediate upside.
• Daily closing below 50-day SMA can recall late-March top.
• Risk reset, cautious mood ahead of the ECB also favors the buyers.

Gold prices bounce off the one-month low to $1,704.60 during the early Thursday. The yellow metal’s failure to close below 50-day SMA, not to forget a six-week-old ascending support line keeps the buyers hopeful.

Also supporting the bullion’s strength could be the recent risk reset as well as the trading lull before the key ECB monetary policy meeting.

As a result, buyers may target the 21-day SMA level of $1,722 during further recovery. However, a downward sloping trend line from May 18, close to $1,741.20, will guard the precious metal’s additional rise.

In a case where the bulls dominate past-$1,741.20, May month top near $1,765.38 and the year 2012 top near $1,797 might flash on their radars.

Meanwhile, a daily closing below 50-day SMA level of $1,696 can recall April 21 bottom of $1,661 whereas March 26 peak surrounding $1,644/45 and 100-day SMA level of $1,641 will challenge the bears.

Gold daily chart

Trend: Bullish