Gold extends the drop from 7-week tops post-China trade

Gold extends its bearish momentum into Asia from the last US session and comes under fresh selling pressure last hour, as soft China’s trade data squashed any hopes of a recovery in the near-term.

Gold: $ 1190 tested

Currently, gold drops -0.67% to meander near session troughs of $ 1190, retreating sharply from seven-week highs reached at $ 1207.05 yesterday. Gold faces double whammy in Asia, with weaker-than expected Chinese exports and imports data re-igniting demand concerns for the yellow-metal from the world’s biggest gold consumer – China on one hand.

While on the other hand, the recovery in greenback across the board gains traction and hence, adds to the downside bias in gold. A stronger US dollar makes gold more expensive for the buyers in foreign currency.

All eyes now remain on the US retail sales and PPI figures due later in the NA session, in order to gauge expectations of higher inflation in Trump’s presidency.

Comex Gold Technical Levels                                  

The metal has an immediate resistance at 1200 (round figure) and 1207.05 (7-week high). Meanwhile, the support stands at 1186.50 (daily S2) below which doors could open for 1180.45 (10-DMA).