Gold slide to $1550 area; erases Friday’s positive move

Gold edged lower on the first day of a new trading week and is currently placed near the lower end of its daily trading range, around $1550 level.

The precious metal failed to capitalize on Friday's post-NFP positive move and met with some fresh supply on Monday. The prevailing risk-on mood was seen as one of the key factors weighing on the precious metal's safe-haven status and exerting pressure.

Gold weighed down by a combination of factors

The global risk sentiment remained well supported by the de-escalation of geopolitical tensions in the Middle East and was further boosted by optimism over the signing of the long-awaited phase-one trade deal between the world's two largest economies.

This coupled with a modest US dollar uptick also played its part in driving flows away from the dollar-denominated commodity. However, a weaker tone surrounding the US Treasury bond yields, led by Friday's weaker-than-expected December US jobs report, might extend some support to the non-yielding yellow metal and help limit deeper losses.

Moving ahead, other important US macro releases scheduled this week will now play a key role in determining the commodity's next leg of a directional move. The US economic docket this week highlights the release of the latest consumer inflation figures on Tuesday and monthly retail sales data on Thursday.

Technical levels to watch