Gold rebounds after yesterday's steep sell-off, around $1280 level
| • Fresh safe-haven demand helps gain some positive traction.
• Softer USD provides an additional boost.
• Wednesday’s FOMC meeting minutes holds the key.
Gold crept up on Tuesday and recovered part of previous session slump, its biggest one-day percentage drop since September 11.
The US President Donald Trump put North Korea back on a list of state sponsors of terrorism on Monday and helped revive safe-haven demand for the precious metal. Also collaborating to up-move was a mildly softer tone around the US Dollar, which tends to boost dollar-denominated - like gold.
With December Fed rate hike move nearly priced in the markets, Wednesday's release of the FOMC meeting minutes would be scrutinized for fresh clues over the central bank's monetary policy outlook post-December and would eventually help determine the next leg of directional move for the non-yielding yellow metal.
Also in focus would be any new developments on the Trump Administration's tax cut bill and the latest political chaos in the Euro-zone's largest economy, Germany.
On the economic data front, the only scheduled release of existing home sales data might provide some trading impetus, while broader market risk sentiment would continue to play a dominant role in driving the commodity on Tuesday.
Technical levels to watch
A follow-through recovery move is likely to get extended towards $1284-85 hurdle, above which the metal is likely to make a fresh attempt to move past $1290 supply zone and retest $1295 strong resistance.
On the flip side, $1276 level now seems to protect the immediate downside, which if broken is likely to accelerate the fall towards $1269 intermediate support en-route $1265 and $1260 levels.
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