Gold regains traction, turns positive for fifth consecutive session

Gold regained traction at lower level and resumed with its near-term upward trajectory, moving back into positive territory for the fifth consecutive session.

Currently trading around $1197 region, testing session peak, a fresh wave of US Dollar weakness revived demand for dollar-denominated commodities - like gold, and has been the key factor driving the yellow metal's recovery from session low.

Earlier on Friday, the precious metal extended the reversal move from Thursday's 7-week high, marking 38.2% Fibonacci retracement level of post-US election slump to nearly 10-1/2 month lows. Disappointing Chinese trade balance data coupled with a mild greenback recovery dragged the commodity to session low near $1191 region. 

The US Dollar price dynamics remains a key determinant of the metal's near-term trajectory and hence, investors on Friday would remain focused on the US macro data, including monthly retail sales data, PPI print and Prelim UoM Consumer Sentiment index, due later during NA session.

Technical levels to watch

Momentum back above $1200 handle is likely to lift the commodity back towards $1205-07 resistance area, marking 38.2% Fibonacci retracement level. A convincing break through $1205-07 resistance now seems to pave way for continuation of the upward trajectory towards $1214-15 resistance ahead of $1220-21 resistance (Nov. 22 high).

On the downside, weakness below session low support near $1191 level might now find support at 50-day SMA near $1187-86 region, which if broken might trigger a short-term profit taking slide initially towards $1180 intermediate support, en-route 23.6% Fibonacci retracement level support near $1172-70 region.

    1. R3 1221.09
    2. R2 1214.02
    3. R1 1204.65
  1. PP 1197.58
    1. S1 1188.21
    2. S2 1181.14
    3. S3 1171.77