Gold reverses a dip below $1300 mark

Haresh Menghani FXStreet

Gold extended its profit-taking slide from multi-month highs for the third consecutive session and dipped below the $1300 mark, albeit has managed to bounce off lows.

A quick reversal in investors' risk appetite, following Tuesday’s North Korean headlines, exerted some bearish pressure around the safe-haven precious metal.

Wednesday's upbeat US economic reports - ADP and GDP, helped the US Dollar Index to extend its solid rebound from over 2-1/2 year lows and further dented demand for dollar-denominated commodities - like gold.

• US Dollar firm, around 93.00 ahead of US PCE

Adding to this, today's upbeat Chinese manufacturing PMI added to the buoyant sentiment and contributed to the yellow metal's fall back below the key $1300 psychological mark.

The metal, however, showed resilience at lower level and has recovered back to $1307 level amid persistent concerns around North Korea-related tensions.

Moreover, investors also seemed reluctant to place aggressive bets ahead of Friday’s keenly watched NFP data, which might influence the Fed’s near-term monetary policy outlook and eventually provide fresh impetus to the non-yielding commodity.

Ahead of the official jobs report, today’s US economic docket would be looked upon to grab some short-term trading opportunities.

Technical levels to watch

Bulls would be eyeing for a sustained move beyond $1310 level, above which the metal is likely to head towards $1315 hurdle before eventually darting towards yearly tops resistance near the $1325 region.

On the flip side, a decisive break below the $1300 mark could extend the corrective slide towards $1292-91 horizontal support ahead of $1284 level.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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