Gold consolidates in a range, just below 6-month tops

   •  US-China trade optimism prompts some long-unwinding trade on Monday.
   •  Expectations of a dovish Fed/global growth concerns helped limit downside. 

Gold was seen oscillating in a narrow trading band and remained within striking distance of over six-month tops set on Friday.

The precious metal now seems to have entered a bullish consolidation phase, especially after this month's strong up-move of nearly 5% and amid relatively thin liquidity conditions. 

The US President Donald Trump sent positive signals to ease US-China trade tensions, which eventually dented the precious metal's safe-haven status during the Asian session on Monday.

The downtick, however, turned out to be rather shallow amid a fragile sentiment surrounding the US Dollar, which has been one of the key factors behind the recent upsurge to the highest level since June 19.

Expectations of a dovish Fed next year, along with a partial US government shutdown kept the USD bulls on the defensive and continued benefitting the dollar-denominated commodity. 

This coupled with concerns over a global economic slowdown should further collaborate towards limiting any meaningful corrective slide ahead of this week's important release of the keenly watched US NFP report.

Technical levels to watch

On a sustained move beyond $1282 level, the commodity is likely to accelerate the up-move towards $1290 horizontal zone before eventually darting towards reclaiming the $1300 round figure mark. On the flip side, the $1276-74 region now seems to act as immediate support, which if broken might drag the metal further towards $1270 level en-route $1265 support area.