26 March, 2018
Easing trade-war fears/risk recovery prompts some profit-taking. Persistent USD weakness helps limit further downside.
Gold surrendered early modest gains to fresh 1-month tops and is currently placed near session lows, touched in the past hour.
Easing fears of a full-blown US-China trade war, coupled with a slight improvement in investors' appetite for riskier assets, as depicted by positive sentiment around European equity markets, dented the precious metal's safe-haven appeal and prompted some profit-taking at higher levels.
Adding to this, a goodish pickup in the US Treasury bond yields was further seen weighing on the non-yielding yellow metal and further collaborated to the mildly weaker tone.
Further downside, however, remained cushioned by persistent US Dollarselling bias, which tends to underpin demand for dollar-denominated commodities - like gold. Hence, it would prudent to wait for any subsequent long-unwinding pressure before confirming that the metal might have topped out in the near-term.
Later during the NY session, speeches by various FOMC members might influence Fed rate hike expectations and eventually help traders grab some short-term opportunities.
Technical levels to watch
Immediate support is pegged near $1340 level, below which the corrective slide could further get extended towards $1332-30 support area. On the upside, sustained move beyond $1350 level might now lift the commodity back towards $1358-60 supply zone.
Bulls fail to capitalize on the recent recovery move from over one-month lows. A goodish recovery in European equities dampens safe-haven demand. A modest USD
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