“¢ A modest USD rebound/US-China trade optimism prompts some fresh selling.
“¢ Downside remains limited on the back of Powell’s overnight dovish message.
“¢ Today’s release of US durable goods orders eyed for some short-term impetus.
Gold traded with a mild negative bias through the early European session on Wednesday, albeit remained well within this week’s broader trading range.
The precious metal failed to capitalize on the overnight rebound, which followed the Fed Chair Jerome Powell’s testimony before the Senate and met with some fresh supply amid a modest US Dollar rebound.
With investors looking past Powell’s dovish message, the greenback managed to bounce off near three-week lows and was seen as one of the key factors exerting some downward pressure on the dollar-denominated commodity.
This coupled with growing optimism over a possible resolution of the long-standing US-China trade dispute further dented the precious metal’s relative safe-haven status and collaborated to the prevalent weaker tone.
Looking at the broader picture, the commodity lacked any firm near-term directional bias and extended its sideways consolidative price action for the third consecutive session, awaiting fresh updates on the US-China trade talks.
In the meantime, today’s release of durable goods orders for January, coupled with the Fed Chair Jerome Powell’s second appearance before the Congress will be looked upon in order to grab some short-term trading opportunities.
Technical levels to watch
Immediate support is pegged near the $1322-21 region, below which the corrective slide could further get extended towards $1314-13 intermediate support before the commodity eventually drops to $1306-05 support area. On the flip side, the $1330-32 region now seems to have emerged as an immediate hurdle, which if cleared might assist the metal to make a fresh attempt towards retesting the $1340-41 supply zone.
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