Few takers for gold despite risk-off in Europe

Mumbai-India (Feb 2)  The safe haven appeal of Gold has not come into play today despite risk-off in Europe, leaving the pair weak at the daily lows around USD 1123.39 levels.

Is it a technical correction?

Prices have gained almost $60 since mid-January. Consequently, the drop seen today could be a technical correction rather than the fundamental weakness. Moreover, prospects of more aggressive monetary easing after Japan’s negative rate surprise and the risk-off in equities means fundamentals remain supportive.

Ahead in the day, the prices remain at the mercy of the overall market sentiment as the US economic calendar is light.

Gold Technical Levels

The metal hovers around USD 1124/Oz levels. The immediate resistance is seen at 1130 (200-DMA), above which the gains could be extended to 1136.68 (Oct 8 low). On the other hand, a break below 1122.33 (5-DMA) could open doors for a slide to 1113.75 (10-DMA).

SourceL FXstreet