Gold holds weaker below $1300 mark, focus shifts to Trump-Kim meeting and FOMC
| • Risk-on mood prompts some fresh weakness at the start of a new week.
• A goodish pickup in the US bond yields adds to the selling pressure.
• Subdued USD demand does little, albeit helps limit further downside.
Gold traded with a mild negative bias through the early European session but remains within a four-day-old narrow trading range.
The precious metal continued with its struggled to sustain/build on momentum beyond the $1300 round figure mark, with a combination of factors exerting some fresh downward pressure at the start of a new trading week.
Despite G7 debacle, improving investors’ appetite for riskier assets, as depicted by buoyant sentiment surrounding European equity markets, was seen weighing on the precious metal's safe-haven appeal.
This coupled with a goodish pickup in the US Treasury bond yields further collaborated towards driving flows away from the non-yielding yellow metal.
However, a subdued US Dollar demand, which tends to underpin demand for dollar-denominated commodities - like gold, extended some support and helped limit further downside, at least for the time being.
Investors' focus now shifts to the US President Donald Trump's key meeting with North Korean leader Kim Jong Un, which along with the latest FOMC monetary policy update will help determine the commodity's next leg of directional move.
Technical levels to watch
Immediate support is pegged near the $1293-92 region, below which the metal could slide back towards $1287 intermediate level en-route multi-month low near the $1282 level touched on May 21st.
On the flip side, sustained move beyond the $1300 handle but is likely to confront resistance near the $1307-08 region (200-day SMA), which if cleared could pave the way for further near-term appreciating move.
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 assets. 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 Open Markets 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. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.