Gold pulls away from $1230 as Wall Street starts the day higher
|- Major equity indexes in the U.S. push higher on Friday.
- US Dollar Index retreats to session lows near 95.80.
- FOMC member Bostic is scheduled to deliver a speech later in the session.
After rising to a daily high above $1230, the XAU/USD pair lost its traction in the last hour as markets lost interest in the safe-haven precious metal with major equity indexes in the U.S. staging a strong recovery in the first hour of trading. As of writing, the pair was still up 0.2% on a daily basis near $1228.
Led by the tech-heavy Nasdaq Composite Index, which finished the previous day with a loss of nearly 2% before opening 1% higher today, Wall Street started the day on a strong note. At the moment, the Dow Jones Industrial Average and the S&P 500 were up 0.8% and 0.6%, respectively, to reflect an improved market sentiment.
On the other hand, following its upsurge to a fresh 10-day high above 96, the US Dollar Index reversed its course in the NA session and was last seen down 0.2% on the day at 95.80. The recent USD weakness seems to be caused by the increasing demand for the euro following the European Affairs Minister Pierre Moscovici's remarks that eased concerns over the Italian budget crisis. On the other hand, the data from the U.S. showed that existing home sales declined by 3.4% in September to fall short of the market expectation of -0.7%.
Later in the session, Atlanta Fed President Raphael Bostic's speech will be looked upon for fresh impetus.
Technical levels to consider
The pair could encounter the first resistance at $1235 (Jul. 26 high) ahead of $1244 (Jul. 17 high) and $1255 (Jul. 11 high). On the downside, supports could be seen at $1224 (Oct. 16 low), $1220/19 (Oct. 15 low/daily low) and $1215 (Oct. 12 low).
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