Gold in search of a firm direction, holds steady near $1275 area
• The USD remains supported by the Fed’s patient stance and caps gains.
• Risk-off mood underpins safe-haven demand and limits the downside.
Gold lacked any firm directional bias and continued with its sideways consolidative price action, well within this week's broader trading range.
The precious metal struggled to capitalize on its attempted recovery from two-week lows, with a combination of diverging forces failing to provide any meaningful impetus and leading to a subdued price action for the second consecutive session on Thursday.
The US Dollar held steady near the 98.00 handle and remained supported by the fact that the latest FOMC meeting minutes reaffirmed the Fed’s patient stance, which was eventually seen as one of the key factors keeping a lid on every attempted positive move.
However, a further escalation in the US-China trade tensions continued denting the global risk sentiment and the same was evident from the prevailing risk-off mood across equity markets, which underpinned the precious metal's safe-haven demand and helped limit deeper losses.
Meanwhile, the global flight to safety triggered a fresh leg of a downfall in the US Treasury bond yields and provided a minor lift to the non-yielding yellow metal, albeit bulls still seemed to lack any strong conviction and awaited a fresh catalyst for any further up-move.
In the absence of any major market moving economic releases from the US, it would be prudent to wait for a convincing break in either direction before traders start positioning for the commodity's near-term trajectory.
Technical levels to watch
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
