Gold jumps to fresh weekly tops, US macro data in focus
| • Persistent USD weakness helps build on overnight recovery move.
• Reviving safe-haven demand provides an additional boost.
• US CPI/monthly retail sales data to provide fresh impetus.
Gold continued gaining some positive traction through the early European session and was seen building on overnight recovery move from over 1-week lows.
The greenback selling pressure remained unabated on Wednesday, with the key US Dollar Index dropping to its lowest level in almost three-weeks and underpinning demand for dollar-denominated commodities - like gold.
• US Dollar extends the drop below 94.00
Meanwhile, a sell-off in global equity markets also seems to have revived the precious metal's safe-haven demand and remained supportive of the follow-through up-move on Wednesday.
Currently placed at weekly tops, around the $1284-85 region, investors now look forward to the key US macro data - CPI and monthly retail sales data, which might influence December Fed rate hike expectations and provide some fresh impetus for the non-yielding metal.
Technical outlook
Omkar Godbole, Analyst and Editor at FXStreet writes: "The metal is likely to witness a bullish cup and handle breakout soon. A move above $1284 would confirm a bullish break and shall open doors for a rally to $1306 (Oct. high)."
"On the downside, only an end of the day close below the 200-day MA of $1264 would signal the continuation of the sell-off from the high of $1357.52 (Sept. high)" he adds.
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