Gold remains in the red near $1265 as US stocks gain traction
|- Gold loses momentum ahead of 200-DMA.
- Wall Street starts the day on a positive note.
- DXY stays in daily range near 93.
The XAU/USD pair is having a difficult time extending its weekly gains on Thursday and stays in the negative territory in the early NA session amid an improved market sentiment. As of writing, the pair was at $1264.50, down 0.1% on the day.
Markets ignore mixed macroeconomic data from the U.S.
Today's data from the United States showed that the third estimate of the third quarter GDP growth declined to 3.2% from 3.3%, missing the market expectation of 3.3%. However, both the Chicago Fed National Activity Index and Philly Fed Manufacturing Index data beat the experts' estimates, not allowing the initial negative impact of the GDP data on the greenback to persist. As of writing, the US Dollar Index is virtually unchanged on the day at 92.95.
On the other hand, major equity indexes, which recorded two consecutive daily losses, started the day on a high note and began to retrace their recent losses, keeping the investors' focus on riskier assets instead of traditional safe-havens such as gold. At the moment, the Dow Jones Industrial Average and the S&P 500 were up 0.4% and 0.3% respectively.
With no macroeconomic data releases left in the remainder of the session and a relatively subdued trading action ahead of the Christmas break, the pair is likely to fluctuate in its tight daily range.
Technical outlook
In order to extend its uptrend, the pair needs to make a daily close above $1271 (200-DMA). Above that level, the pair could aim for $1277 (Dec. 4 high) and $1290 (Dec. 1 high). On the downside, supports could be seen at $1260 (20-DMA), $1252 (Dec. 28 low) and $1240 (Dec. 13 low). The CCI indicator on the daily chart recently eased below the 100 mark, suggesting that the bullish momentum is losing strength.
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