Gold falls to over 1-week lows, below $1220 level

   •  Resurgent USD demand kept exerting downward pressure on Friday.
   •  Firming Fed rate hike expectations add to the ongoing bearish slide.
   •  A slight deterioration in investors’ risk-appetite does little to lend support.

Gold remained under some selling pressure for the sixth consecutive session on Friday and is currently placed at over one-week lows, just above 100-day SMA support.

The commodity extended this week's sharp retracement slide from the $1236-37 supply zone, touched in the aftermath of the US midterm election results on Wednesday, and was being weighed down by a combination of negative factors.

A fresh leg of the US Dollar upsurge back closer to monthly tops, supported by the Fed's hawkish assessment of the economy, was seen as one of the key factors dampening demand for the dollar-denominated commodity. 

The Fed also reiterated its commitment to continue raising interest rates gradually in the future and further collaborated towards driving flows away from the non-yielding yellow metal. 

Meanwhile, the prevalent risk-off mood, reinforced by a modest retracement in the US Treasury bond yields, did little to support the precious metal's safe-haven status and stall the ongoing downfall.

It would now be interesting to see if the commodity is able to find any buying interest at lower levels or continue with its bearish slide as market participants now look forward to the US economic docket for some fresh impetus.

The latest US PPI figures, along with the release of Prelim UoM Consumer Sentiment might produce some meaningful trading opportunities during the early North-American session. Nevertheless, the metal remains on track to record weekly losses of over 1.0%, its biggest weekly decline since August.

Technical levels to watch

A follow-through selling below 100-day SMA support, near the $1216 region, is likely to accelerate the fall towards a multi-week low level of $1212 en-route its next support near the $1207-06 horizontal zone. On the flip side, the $1222-23 region now seems to have emerged as an immediate resistance, above which the commodity is likely to head back towards testing the $1234 supply zone.