Gold oscillating in a range around $1250, awaits FOMC minutes for fresh impetus

After an initial dip to $1248 level, gold seems to have regained some traction and is now headed toward the top end of daily trading range.

Currently trading around $1252 region, the precious metal's rebound from session low could be attributed to a modest greenback retracement led by softer tone surrounding the US treasury bond yields. A weaker US Dollar tends to lift dollar-denominated commodities - like gold. 

Adding to this, the prevalent cautious sentiment surrounding the European equity market provided an additional boost to traditional safe-haven assets and helped the yellow metal to reverse part of previous session's reversal move from near three-week tops. 

It, however, remains to be seen if the commodity is able to build on the up-move or once again runs through fresh offers at higher levels amid growing prospects for an eventual Fed rate-hike action in June. 

Investors now look forward to the release of minutes of the Federal Reserve's latest monetary policy meeting, which would be closely scrutinize to reaffirm June Fed rate-hike expectations and for hints over the timing of the next rate-hike move. The central bank's monetary policy outlook would act as a next big catalyst determining the next leg of directional move for the non-yielding metal.

   •  FOMC Minutes to give more insight about the timing of the next hike – Danske Bank

Technical levels to watch

Momentum above $1255 immediate resistance could get extended back towards $1260 resistance area before the metal eventually heads towards testing multi-week highs resistance near $1264-65 region.

On the downside, weakness below session lows support near $1248 level now seems to drag the commodity towards the very important 200-day SMA near $1245-44 region, which if broken would turn it vulnerable to head back towards $1240 intermediate support en-route $1229-27 area.