Gold price sits at session tops, just below $1225 level
New York (Nov 27) Gold reversed an early dip to over one-week lows and was now seen trading with modest gains, just below $1225 level, around the top end of its daily trading range.
The commodity stalled overnight retracement slide, triggered by resurgent US Dollar demand and a strong positive move across global equity markets, and once again, managed to find decent support near $1220 horizontal zone.
The greenback continued gaining positive traction on Tuesday and remained supported by resurfacing US-China trade tensions, especially after the US President Donald Trump threatened to move ahead with raising tariffs on $200 billion in Chinese imports to 25% from 10% currently.
However, the prevalent negative mood around equity markets, which tend to underpin demand for traditional safe-haven assets, extended some support to the dollar-denominated commodity and helped recover early lost ground to the lowest level since Nov. 19.
It, however, remains to be seen if the commodity is able to build on the positive momentum or continues to meet with some fresh supply at higher levels as investors wait for fresh cues about the Fed's near-term monetary policy outlook.
Hence, the Fed Chair Jerome Powell's scheduled speech on Wednesday and minutes from the latest FOMC meeting on Nov. 7-8 on Thursday will play an important role in determining the next leg of a directional move for the non-yielding yellow metal.
In the meantime, today’s release of the Conference Board’s US consumer confidence index, coupled with speeches by various FOMC members might influence the USD price dynamics and eventually produce some meaningful trading opportunities.
Technical levels to watch
Any subsequent up-move might continue to confront some fresh supply near the $1228-30 region, above which the momentum could further get extended towards $1234 horizontal zone en-route the $1240 resistance.
On the flip side, the $1220 region might continue to protect the immediate downside, which if broken is likely to accelerate the fall towards $1213-12 intermediate support before the metal eventually drops to the $1208-07 region.
FXstreet
