“¢ Fails to extract any support despite a combination of supportive factors.
“¢ Technical selling seems to be only factors behind the latest leg of steep decline.
Gold continued losing ground through the early North-American session and tumbled back closer to YTD lows in the last hour.
The precious metal extended overnight pull-back from one-month tops and remained under intense selling pressure on Friday, defying all positive factors. The latest leg of sudden fall over the past couple of hours occurred despite a weaker tone surrounding the US Dollar, which tends to underpin demand for dollar-denominated commodities – like gold.
Moreover, deteriorating investors’ appetite for riskier assets, as depicted by weakness across equity markets amid escalating US-China trade tensions, did little to revive the precious metal’s safe-haven demand. The risk-off mood was further reinforced by the ongoing slide in the US Treasury bond yields, which again failed to lend any support and stall the non-yielding yellow metal’s slump to near four-week lows.
Meanwhile, technical selling below a short-term ascending trend-line support, near the $1294 region, seems to be one of the key factors behind the commodity’s steep decline on the last trading day of the week. With today’s downfall, the commodity has lost nearly 2% over the past 24-hours and now looks all set to end with a weekly loss of over 1%.
Technical levels to watch
A follow-through selling below $1282 level (YTD lows) might continue dragging the metal further towards its next support near $1275 region, with some intermediate support near the $1280 area. On the upside, recovery attempts might now confront fresh supply near the $1294 region and any subsequent up-move seems more likely to be capped at the key pivotal $1300 round figure mark.
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