Gold plummets to 1-1/2 week lows, remains vulnerable below $1500 mark
|- The USD stood tall near two-week lows and exerted some fresh downward pressure.
- Improving risk sentiment further weighed on the yellow-metal's safe-haven status.
- Technical selling below $1500 mark seemed to have aggravated the bearish pressure.
Gold continued losing ground through the early North-American session, farther below the key $1500 psychological mark, and dropped to 1-1/2 week lows in the last hour.
Following the previous session's two-way price action, the traditional safe-haven commodity came under some renewed selling pressure on the last trading day of the week and failed to gain any respite from the ongoing political drama in the United States. It is worth recalling that the controversy around a whistleblower report prompted House Democrats to launch a formal impeachment inquiry against the US President Donald Trump earlier this week.
Weighed down by stronger USD/fading safe-haven demand
Traders, however, seemed unimpressed by the recent US political developments, rather took cues from the prevailing bullish sentiment surrounding the US Dollar. In fact, the key USD Index held steady just below two-week tops set earlier this Friday and was seen as one of the key factors weighing heavily on the dollar-denominated commodity - Gold.
This coupled with improving global risk sentiment, as depicted by a positive trading mood around equity markets amid the recent encouraging US-China trade development, allowed the US Treasury bond yields to regain some positive traction on Friday and further collaborated towards driving flows away from the non-yielding yellow metal.
Apart from this, possibilities of some short-term trading stops being triggered and (or) fresh technical selling below the $1500 handle seemed to have further contributed towards aggravating the intraday bearish pressure. Hence, a follow-through weakness, back towards challenging monthly swing lows support near the $1483 region, now looks a distinct possibility.
Technical levels to watch
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