Gold Turns Lower to Test 50-DMA
Gold erased
Asian session-gains and fell back in the red zone as the US dollar
picked-up strength amid broad based sell-off seen across the financial
markets.
Gold hovers around $ 1250 mark
Currently, gold trades -0.15% lower at 1249.71 in close proximity to
daily lows struck at 1249.42, having breached 50-DMA support located at
1249.90. The bullion's recovery mode lost legs near 1255-56 levels and
the prices turned lower once again, despite negative European equities
and oil-price sell-off, as markets continue to price-in a June Fed rate
hike amid renewed optimism on the US growth outlook.
Moreover, a stronger greenback against most major currencies, viz., the
EUR, GBP, AUD etc., also weighed on the yellow metal. A stronger US
dollar makes the dollar-denominated gold more expensive for the holders
in other currencies. Markets now digest FOMC member Bullard’s comments
ahead of the US flash manufacturing PMI data due later in the American
session.
Gold Technical Levels
The metal has an immediate resistance at 1260 (round figure) and 1266
(20-DMA). Meanwhile, the support stands at 1243.81 (May 19 Low) below
which doors could open for 1237.45 (Apr 28 Low).
