Gold eases from tops, but holds with modest gains above $1300 mark
| • The prevalent USD selling bias continues to underpin for the third straight session.
• Improving risk-sentiment seemed to keep a lid on any strong follow-through up-move.
• Investors also seemed reluctant to place aggressive bets ahead of FOMC on Wednesday.
Gold trimmed a part of the early gains to multi-day tops, albeit has managed to hold its neck above the key $1300 psychological mark.
The precious metal traded with a mild positive bias for the third consecutive session and built on the recent goodish up-move, albeit a combination of factors kept a lid on any strong follow-through and kept a lid on any runaway rally.
Growing market expectations that the Fed will opt for a more accommodative policy stance this week kept the US Dollar bulls on the defensive and turned out to be one of the key factors benefitting the dollar-denominated commodity.
The positive factor, to a large extent, was offset by improving risk sentiment, which tends to dent the metal's safe-haven demand. This coupled with investors’ reluctance to place any aggressive bets ahead of this week’s key event risk – the latest FOMC monetary policy update, further collaborated towards capping any runaway rally for the non-yielding yellow metal.
In the meantime, the USD price dynamics and the broader market risk sentiment might continue to play a key role in influencing the commodity’s price action amid absent relevant market moving US economic releases on Tuesday.
Technical levels to watch
The $1300-$1298 region might continue to act as immediate support, which if broken might accelerate the slide further towards $1294-93 region before the commodity eventually drops to $1290 level en-route the $1286-85 zone. On the flip side, the $1308-10 area now seems to have emerged as an immediate hurdle, above which the commodity is likely to head towards testing the $1313-15 supply zone.
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