Gold refreshes weekly tops, inching closer to $1230 level
• Powell’s overnight dovish comments helped stage a goodish recovery.
• Declining US bond yields offset positive equities/a modest USD bounce.
• The FOMC Nov. meeting minutes to provide a fresh directional impetus.
Gold edged higher for the second consecutive session on Thursday and is currently placed at the top end of its weekly trading range, around the $1227-28 region.
The Fed Chair Jerome Powell's comments that rates are just below the neutral level now triggered a broad-based US Dollar weakness and prompted some short-covering trade around the dollar-denominated commodity.
The USD bearish pressure now seems to have abated, though expectations of a slowdown in interest rate hikes, reinforced by sliding US Treasury bond yields, kept pushing the non-yielding yellow metal higher through the mid-European session on Thursday.
Even the prevalent positive mood around European equity markets, which tends to undermine demand for traditional safe-haven assets, did little to prompt any fresh selling around the precious metal or stall the ongoing positive momentum.
With investors now pricing in only one more rate hike in 2019, today's release of the minutes from the November FOMC meeting will now play an important role in determining the commodity's next leg of directional move.
Technical levels to watch
A follow-through buying interest has the potential to continue lifting the metal further towards the $1234-35 supply zone en-route Oct. monthly highs resistance near the $1243 region. On the flip side, the $1223-22 region now seems to protect the immediate downside, which if broken might accelerate the fall towards $1220 intermediate support ahead of $1215 horizontal zone.
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
