Gold Finds Good Support Near $ 1207, NFP in Spotlight
Gold trades moderately higher in the Asian trades, underpinned by risk-off markets and a broadly lower US dollar, as we head towards the ECB policy decision on the interest rates.
Gold re-takes 5-DMA
Currently, gold now trades +0.24% higher at 1210.48, having posted day’s high at 1211.51 and day’s low at 1207.58. The bullion makes fresh recovery attempts in the Asian trades this Friday and recovers almost a half of the previous drop, as the USD bulls took a breather from Thursday’s sharp rebound after the US ADP report matched estimates, while a dovish ECB also boosted the greenback at the expense of the euro.
Moreover, gold also received fresh impetus from a cautious tone prevalent in the markets, after the Chinese services sector activity report deteriorated last month, and therefore dampened investors’ sentiment.
However, further upside is likely to remain capped near 1220 levels, confluence zone of previous high and 10-DMA, as the US NFP data may come out stronger and raise odds for a June/July Fed hike, weighing negatively on the non-interest bearing gold.
Gold Technical Levels
The metal has an immediate resistance at 1221 (100-DMA) and 1225 (round number). Meanwhile, the support stands at 1205.90 (Jun 1 Low) below which doors could open for 1200 (key support).