Gold built on previous session's recovery move from 5-week lows and jumped back above $1250 level, closer to weekly highs.
The ongoing slump in oil prices pushed down the US equity markets and was seen extending support to the precious metal's safe-haven appeal.
Moreover, continuous slide in oil prices also fueled concerns over slowing inflationary pressure, which now seems to have raised doubts over the prospects for a third Fed rate hike this year. The same is evident from flattening of the US Treasury yield curve, which is eventually benefitting the non-yielding metal.
Adding to this, a softer tone around the greenback, with the key US Dollar Index easing from one-month highs, provided an additional boost to the yellow metal's strong recovery move back closer to weekly tops near $1255 region.
Later during the NA session, the release of usual weekly jobless claims from the US would influence sentiment surrounding the greenback and provide some trading impetus for the dollar-denominated commodity.
Technical levels to watch
A strong follow through buying interest should continue to boost the metal towards $1260 resistance area, above which a fresh bout of short-covering has the potential to lift it further towards $1266-67 horizontal resistance.
On the flip side, retracement back below $1250 level now seems to find support near $1246 level, which if broken would expose the very important 200-day SMA support near $1237 region.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.