Home Gold struggles to register any meaningful recovery
FXStreet News

Gold struggles to register any meaningful recovery

   “¢   Trump’s overnight comments helped ease the prevalent bearish pressure.
   “¢   The recovery lacked any strong conviction amid fading safe-haven demand.

Gold reversed an early dip to $1215 area, closer to one-year lows set overnight, and is currently placed at the top end of Friday’s Asian session trading range.  

The US President Donald Trump’s overnight comments, expressing displeasure about the Fed’s monetary tightening, triggered a broad-based US Dollar sell-off and helped ease bearish pressure surrounding the dollar-denominated commodity. This coupled with a sharp fall in the US Treasury bond yields extended some additional support to the non-yielding yellow metal.  

Despite a combination of supporting factors, the precious metal failed to capitalize on the recovery momentum and was being capped by the prevalent risk-on mood. A positive trading sentiment around Asian equity markets weighed on the precious metal’s safe-haven appeal and exerted some fresh downward pressure during early trading hours on Friday.

Meanwhile, traders held back from placing any fresh bearish bets amid highly near-term oversold conditions, which now seems to have prompted some short-covering amid a subdued opening across European bourses and weaker USD price-action.  

Technical levels to watch

Any meaningful up-move might continue to confront fresh supply near the $1229-30 region, above which the commodity could recover further towards a previous support, now turned resistance, near the $1237-38 zone.  

On the flip side, $1215 level, closely followed by $1212-11 area, now seems to protect the immediate downside, which if broken could accelerate the fall towards $1204 level en-route the $1200 handle.
 

FX Street

FX Street

FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions.