Spot gold recovered above the former primary support level at $1200/ounce despite low inflation and the stronger Dollar. I would attribute demand to rising uncertainty in the global economy, with falling oil prices, political turmoil in the Middle East and Eastern Europe, and the potential for a currency war with competing currency debasement (QE) between Japan, China and the EU.
Bullish divergence on 13-week Twiggs Momentum suggests a recovery. Breakout above $1250 would indicate a rally to $1400. But reversal below $1200 remains as likely and would warn of a decline to $1000. Respect of the TMO zero line (from below) would strengthen the bear signal.