“¢ Persistent USD weakness/reviving safe-haven demand provides a minor boost.
“¢ Rising US bond yields/ECB QE end talks keep a lid on any meaningful up-move.
Gold inched up on Thursday but seemed lacking strong conviction and remained capped below the $1300 mark.
The US Dollar selling pressure remained unabated on Thursday and was seen as one of the key factors underpinning demand for dollar-denominated commodities – like gold. Adding to this, the prevalent cautious sentiment around equity markets was further seen extending some support to the precious metal’s safe-haven demand.
The positive factors, to a larger extent, were negated by some renewed uptick in the US Treasury bond yields. This coupled with growing speculation that the European Central Bank (ECB) may announce the timing to end its massive bond-buying program as early as next week further contributed towards keeping a lid on any meaningful up-move for the non-yielding metal.
In absence of any major market moving economic releases, the commodity seems more likely to extend its range-bounce price action amid a combination of diverging forces.
Technical levels to watch
Any subsequent up-move beyond the $1300 handle is likely to confront stiff resistance near the $1307-08 region (200-day SMA), above which the metal seems to rise towards $1313-14 intermediate resistance en-route $1321-22 supply zone.
On the flip side, $1293-92 area might continue to act as an immediate support, which if broken could drag the commodity back towards $1287-85 horizontal support en-route $1282 level – yearly lows set on May 21.
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