Gold traded with mild positive bias and eroded part of previous session losses, albeit remained closer to two-week lows.
Currently trading around $1266 region, a slight deterioration in investors’ risk-appetite, amid growing political tensions between the US and N. Korea, boosted the precious metal’s safe-haven appeal. Adding to this, softer tone surrounding the US treasury bond yields failed to provide any additional lift to the US Dollar and further benefitting dollar-denominated commodities – like gold.
Despite of the tepid recovery move the yellow metal remains on track for its second consecutive week of declines. Focus shifts to the US economic docket, with spotlight on the first US GDP growth estimates, which is likely to influence Fed rate-hike expectations and eventually provide fresh impetus for the non-yielding metal.
Apart from the US GDP print, a slew of important macroeconomic releases from other major economies might also infuse some volatility and derive demand for traditional safe-haven assets, including gold.
Technical levels to watch
Immediate resistance is pegged near $1270 level, above which a bout of short-covering could lift the commodity towards $1275 horizontal resistance en-route $1279-80 hurdle. On the downside, $1260 level now seems to have emerged as immediate support, which if broken seems to accelerate the slide towards the very important 200-day SMA support near $1253 region.