Gold regains positive traction, bulls eyeing a sustained move beyond $1400 mark
|- The USD fails to capitalize on the intraday bounce and helped regain traction.
- Escalating geopolitical tensions remained supportive of the strong bid tone.
- The commodity remains on track to post the fourth consecutive week of gains.
Gold quickly reversed an early dip to daily lows, around the $1383 region, with bulls making a fresh attempt to lift it back above the key $1400 psychological mark.
The commodity had good two-way price moves on the last trading day of the week, though a combination of supporting factors helped limit the intraday pullback from multi-year lows and remained supportive.
Despite a solid rebound in the US Treasury bond yields, the US Dollar struggled to capitalize on its attempted intraday rebound and was seen as one of the key factors underpinning the dollar-denominated commodity.
The greenback remained on the defensive in the wake of the latest dovish shift by the Fed, signalling that it remains ready to ease monetary policy in order to support economic growth and combat subdued inflationary pressure.
This coupled with escalating geopolitical tensions, especially after Iran shot down a US surveillance drone, weighed on investors' sentiment and further benefitted the precious metal's perceived safe-haven status.
Moving ahead, Friday's US economic docket - featuring the release of flash manufacturing PMI and existing home sales data, seems unlikely to be a major game changer but will still be looked upon for some trading opportunities.
Nevertheless, the commodity remains on trade to end the week with strong gains of over 4%, marking its fourth consecutive week of the positive move, and possibly register its highest weekly closing since August 2013.
Technical levels to watch
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