Gold continued with its struggle to register any meaningful recovery and was confined in a narrow trading range, marginally above a fresh 10-month low of $1157 touched yesterday.
Currently trading around $1170 region, prospects of an imminent Fed rate-hike action in December and increasing possibilities of faster rate-tightening cycle in 2017 continues to weigh on the non-yielding precious metal. The yellow metal has even failed to gain any respite from a mild greenback retracement, as measured by the overall US Dollar Index, which tends to benefit dollar-denominated commodities - like gold. Hence, investors will remain focused on the upcoming FOMC meeting on December 13-14, which would provide fresh insights over the Fed's monetary policy outlook for 2017 and provide fresh impetus for the commodity's near-term direction.
Meanwhile, the prevalent risk-on sentiment is further seen denting the yellow metal's safe-haven investment appeal. Moreover, Monday's Italian referendum driven safe-haven buying turned out to be short-lived, which clearly indicates that investors might not be in a hurry to buy gold ahead of the much awaited Fed monetary policy meeting.
Technical levels to watch
Immediate support is pegged at $1167-66 area below which the commodity seems to drop back to $1160 (Dec. 1 low) before retesting $1157 (yesterday's multi-month low) and eventually dropping to its next support near $1152-50 region. On the upside, momentum above session peak resistance near $1175 could lift the metal towards $$1180 en-route $1188 resistance (yesterday's high) and $1195 strong resistance.
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