Gold climbs to 1-1/2 week tops, back above $1280 level ahead of US GDP

   •  A modest USD pullback from near two-year tops helped regain positive traction.
   •  Cautious mood further underpins safe-haven demand and remained supportive.
   •  Focus remains on today’s important release of the advance US Q1 GDP report.

Gold edged higher on the last trading day of the week and jumped back above $1280 level, just above over one-week tops set in the previous session.

A combination of supporting factors - including a modest US Dollar pullback from near two year tops and weaker opening in the US equity markets despite upbeat US durable goods orders data, assisted the precious metal to build on its modest rebound from near four-month tops touched earlier this week. 

The greenback held on the defensive through the early European session on Friday and was seen as one of the key factors underpinning demand for the dollar-denominated commodity. This coupled with the prevalent cautious mood provided an additional boost to the precious metal's relative safe-haven status and remained supportive.

It would now be interesting to see if the commodity is able to capitalize on the move or once again fizzles out at higher levels as the focus now shifts to the very important release of the US Q1 GDP report, due later during the early North-American session and is expected to show that the annualized US economic growth eased a bit to 2.1%. 

Given the recent robust US macro data, a stronger reading should force investors to start pricing in a hawkish shift in the FOMC's outlook when it announces its latest monetary policy update next Wednesday, which might eventually trigger a fresh leg of a downfall for the non-yielding yellow metal.

Hence, it would be prudent to wait for a strong follow-through buying before confirming that the commodity might have actually bottomed out in the near-term and positioning for any further recovery, possibly back above the key $1300 psychological mark.

Technical levels to watch