Gold surrenders early gains to 1-1/2-year tops
• Easing USD bearish pressure prompts some profit-taking.
• Sliding US bond yields might continue to lend some support.
Gold surrendered majority of its early gains to the highest since August 2016 and quickly retreated back below $1360 level during the early European session.
The US Dollar tumbled to fresh three-year lows on comments by the US Treasury secretary Steven Mnuchin, saying that he welcomed a weaker currency, and continued benefitting the dollar-denominated commodity through the Asian session on Thursday.
A broad-based greenback sell-off receded a bit following IMF chief Christine Lagarde's comments and prompted some profit-taking at higher levels, especially after the recent upsurge of over 3% since last Thursday.
Further downside, however, seems more likely to be cushioned by a softer tone around the US Treasury bond yields, which tends to underpin demand for the non-yielding yellow metal.
Technical levels to watch
A follow-through retracement below the $1355 immediate support is likely to accelerate the corrective slide back below $1350 level towards its next support near the $1344 region.
On the upside, the $1365-66 area might now act as an immediate resistance, above which the metal is likely to aim towards testing July 2016 highs resistance near the $1375 region.
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
