Gold Flat at $1211 Amid Cautious Trade, Focus on NFP
Gold is seen trading flat on Friday around $1211 level, supported by a minor downtick in the greenback as we head towards the key NFP release that would determine the Fed's near-term monetary policy stance.
On Thursday, the precious metal attempted a move above 100-DMA resistance near $1220 but retraced on broad recovery witnessed in the greenback. Thursday's US Dollar strength, as measured by the US Dollar Index, was led by broadly in-line with expected readings from the private sector employment report (ADP report) and weekly jobless claims data.
Investors remained cautious on Friday ahead of the monthly US labor market report. A solid reading would raise expectations of Fed rate-hike as early as during the Federal Reserve's monetary policy meeting on June 14-15, which would further strengthen the greenback and hurt demand for dollar-denominated commodities like gold.
Technical levels to watch
On the immediate downside, $1206-05 area, closely followed by $1200 handle, might continue to extend immediate support. Failure to hold these immediate support levels seems to drag the yellow metal towards testing Feb. 16 lows support near $1190. Meanwhile on the upside, bulls are likely to aim for a move above 100-day SMA resistance near $1220 level, which if conquer should extend the recovery momentum immediately towards $1225 horizontal resistance. A sustained break above $1225 resistance now seems to open room for further near-term appreciation for the metal, towards retesting 50-day SMA strong support, turned resistance, near $1245-47 region.