Gold prices trade above 5-DMA level ahead of the data in China which is expected to show growth rate remained steady in third quarter.
Focus on China data
Retail sales and industrial production is seen coming-in at 10.6% y/y and 6.4% y/y in September. Meanwhile, Q3 GDP is seen unchanged at 6.7% q/q and 1.8% q/q.
Data released last week had shown a 10% drop in Chinese exports in September. Furthermore, the nation had also reported an uptick in CPI. However, gold had failed to respond to weak trade data and high inflation mainly on increased expectations of Fed rate hike in December.
It remains to be seen if the metal responds positively to a possible weak China data today, given the treasury yield curve has steepened since Friday, suggesting the Fed may be slow in raising rates.
Gold Technical Levels
Prices were last seen trading around $1263/Oz levels. A break below $1261.45 (5-DMA) would open doors for a slide to $1256.10 (Oct 18 low) under which losses could be extended to $1253 (23.6% of 2011 high – 2015 low). On the higher side, breach of resistance at $1265 (yesterday’s high) would expose reistance at $1270 (4-hr chart resistance) and $ 1277.16 (Oct 5 high).
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