Gold Halts 3-Day Slide, Rebounds in Asia Near $ 1255

Gold Halts 3-Day Slide, Rebounds in Asia Near $ 1255

23 May 2016, 06:37
Roberto Jacobs

Gold Halts 3-Day Slide, Rebounds in Asia Near $ 1255

Gold kicked-off the week on a stronger footing and ticker higher in the Asian trades amid tumbling Japanese stocks and a moderately lower US dollar across the board.

Gold eyes $ 1260

Currently, gold trades 0.19% higher at 1254.55, having posted day’ low at 1251.11 and day’s high at 1256.14. The bullion attempts a tepid bounce in Asia from three-week lows, after having dropped nearly 2% last week on increasing expectations that the Fed may hike rates as soon as next month. Gold is a non interest bearing investment assets and could suffer from the rise in the US interest rates.

The ongoing recovery attempt can be also attributed to the bullish CFTC report released last Friday, which revealed Hedge funds and money managers raised their bullish bets in COMEX gold futures and options in the week to May 17. Adding to the upbeat sentiment around gold, Holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 1.04 percent to 869.26 tonnes on Friday, the largest since November 2013.

Nothing of significance for gold in the day ahead and hence focus shifts towards the crucial US economic data and Fed Yellen’s speech due later this week.

Gold Technical Levels

The metal has an immediate resistance at 1260 (round figure) and 1266 (20-DMA). Meanwhile, the support stands at 1250 (psychological levels) below which doors could open for 1243.81 (May 19 Low).


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