• Builds on this week’s rebound from 200-DMA amid a follow-through USD weakness. • Retracing US bond yields/reviving safe-haven demand provide an additional boost.
After an initial dip to $1318 area, gold regained positive traction and has now risen to its highest level in over two-weeks.
A combination of supportive factors helped the precious metal to continue with its upward march for the second consecutive session and build on its recovery move from the very important 200-day SMA.
The US Dollar extended its retracement from fresh yearly tops hit earlier this week and was seen benefitting dollar-denominated commodities - like gold. With traders still assessing the implication of yesterday's subdued inflation figures on the pace of the Fed's monetary policy normalization, a follow-through retracement in the US Treasury bond yields provided an additional boost to the non-yielding yellow metal.
Meanwhile, a weaker tone around European equity markets further underpinned demand for traditional safe-haven assets and remained supportive of the precious metal's strong up-move back towards 100-day SMA hurdle, near the $1325-26 region.
The commodity has now gained around 0.8% for the week and in absence of any major market moving economic releases from the US, seems all set to snap three consecutive weeks of losing streak.
Technical levels to watch
On a sustained move above the $1325-26 region (100-DMA), the metal is likely to extend the up-move further towards testing the $1331-33 supply zone. On the flip side, $1317-16 area now seems to protect the immediate downside, which if broken might prompt some fresh selling and drag the commodity back towards $1310 strong horizontal support.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these securities. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Forex involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.