Gold prices drifted lower in the Asian session, having booked strong gains the day earlier after Fed Chair Yellen turned outrightly dovish and triggered a broad USD sell-off.
Gold stalls 2-day rally
Currently, gold edges -0.10% lower to 1237.70, unable to take out strong resistance near 1243 levels. The yellow metal’s overnight rally ran through fresh supply below 20-DMA at 1245 in the Asian morning, and the prices turned lower from there as sentiment towards the safe-haven soured amid a rebound seen in the Asian stocks. The Chinese equities are rallying 1.20% to 1.75%.
The spot bounced to fresh three-day highs of $ 1243.06 on Tuesday after dovish comments from Yellen, citing cautious approach on Fed’s interest rates outlook, weighed heavily on the US dollar and boosted the non-interest paying gold. More so, a pick-up in buying interest for the bullion from the world’s top consumer, China, further added to the upbeat moods around gold.
Focus now remains on the US employment data due in the upcoming NY session, while the key risk event for the week remains the payrolls data lined up for release on Friday, which may provide further cues on the Fed’s future monetary policy path.
Gold Technical Levels
The metal has an immediate resistance at 1243.06/45 (Mar 29 high/ 20-DMA) and 1250 (psychological levels). Meanwhile, the support stands at 1230/26.50 (round figure/ 5-DMA) below which doors could open for 1215.34 (Mar 29 Low).
(Market News Provided by FXstreet)