Gold Fails to Resist Above 50-DMA, Drops Below $ 1250
Gold extends
its losing streak into a fifth-day this Tuesday, as persisting calls
for a June Fed rate hike weighs down on the non-interest paying
investment asset.
Gold surrenders $ 1250 mark
Currently, gold trades -0.10% lower at 1248.10, having posted day’s high
at 1252.35 and day’s low at 1245.65. The bullion is seen making a minor
recovery attempt from session lows and looks to regain 1250 level, as
the underlying risk-off theme in Asia underpins the safe-haven bids for
the yellow metal.
However, any effort to the upside is expected to be sold-off into
persistent broad USD strength, as markets continue pricing-in a June Fed
rate hike, which will make gold unattractive investment asset. A
stronger US dollar makes the dollar-denominated gold more expensive for
the holders in other currencies.
With yesterday’s disappointing flash manufacturing PMI from the US
offering some respite to the bulls, focus now remains on the US new home
sales data due later today, ahead of the US durable good and GDP
figures scheduled for release in the week ahead.
Gold Technical Levels
The metal has an immediate resistance at 1260 (round figure) and 1264
(10-DMA). Meanwhile, the support stands at 1243.81 (May 19 Low) below
which doors could open for 1237.45 (Apr 28 Low).
