Gold prices may trade between $1,180 and $1,220 this week. The impulse to see if gold can be pushed below $1,180 was met with fresh long demand last week, leading the shorts to back off and reverse their positions on a short-term basis.

A fresh run at $1,180 may be expected, and may be similarly repelled. On the up side, gold prices could rise sharply higher this week.

There may be some profit-taking and fresh short selling if prices stall below $1,215 or $1,220. If prices break above $1,220 fresh buying could quickly push gold to $1,230, or even higher.

Gold fabrication and investment demand are entering a seasonally weak period, which is expected to weigh on the price of the metal.

Combined gold exchange traded fund (ETF) holdings rose 78,000 ounces in one week to a record high 65,697,224 ounces on 7 July. The rate of net additions to gold ETFs has slowed, reflecting a reduction in investor economic concerns.