Gold sits at session tops, around $1330 level ahead of US data
• Renewed USD weakness helps regain some traction.
• Surging US bond yields capping additional gains.
• US economic data eyed for trading opportunities.
After an initial dip to fresh weekly lows, gold staged a modest recovery to $1330 level and recovered part of previous session's steep losses.
The precious metal stalled its corrective slide to the lowest level in nearly a week and was now supported by some renewed greenback weakness. In fact, the US Dollar Index struggled to build on overnight rebound from 3-year lows and eventually benefitted dollar-denominated commodities - like gold.
However, a follow-through pickup in the US Treasury bond yields, backed by growing market conviction that Fed would deliver at least three rate hikes in 2018, was seen keeping a lid on any additional gains for the non-yielding yellow metal.
The Federal Reserve's Beige Book, released on Wednesday, provided anecdotal evidence that the US economy is strong enough to withstand multiple rate hikes in 2018 and triggered a fresh leg of an upsurge in the US bond yields.
Investors now look forward to upcoming US economic releases - housing market data, Philly Fed Manufacturing Index and initial weekly jobless claims, in order to grab some short-term trading opportunities.
Technical levels to watch
Momentum beyond $1332 level now seems to accelerate the up-move back towards $1340 supply zone en-route $1345 barrier. On the flip side, $1324 level might continue to protect the immediate downside, which if broken might turn the metal vulnerable to correct further towards $1312 horizontal support.
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
