Gold trims losses after finding resistance at $1230

  • Gold rebounds from 3-day lows but fails to break above $1,230/oz. 
  • Yellow metal receives support from lower US yields amid risk aversion. 

Gold climbed from $1,218/oz and peaked at $1,230 during the US session but found resistance and pulled back. As of writing was trading around $1,225 away from the highs but still on positive ground for the day. The metal continues to move in a consolidation range between $1,220 and $1,230. 

XAU/USD rose amid an increase in the demand for safe-haven assets amid a slide in equities but the upside was limited by a stronger US dollar. The greenback hit weekly highs versus European currencies but pulled back against the yen on the back of lower US yields. The recovery in Treasuries also added support to gold.

Technical outlook 

“The metal retains the positive tone according to the daily chart, as the price continues developing above the 100 DMA, while the 20 DMA advances below it. Indicators in the mentioned chart remain flat near overbought readings, giving not much clue on upcoming direction”, says Valeria Bednarik, Chief Analyst at FXStreet.

In the short-term she points out that the 4 hours chart shows the metal with a neutral-to-positive stance, as technical indicators post modest advances, the Momentum around its 100 level and the RSI at 59 and price a few cents above a flat 20 SMA.

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