Gold eyes 3rd straight weekly drop on June Fed hike talks

Gold’s overnight recovery from three-week lows faltered just shy of $ 1260 and from there on the spot drifted lower, as the US dollar jumped back on the bids amid a better risk tone in the markets.

Gold capped by $ 1260

Currently, gold trades -0.11% lower at 1255.43, having posted day’ low at 1254.90 and day’s high at 1257.90. The bullion fell to fresh three-week lows in the last American session as the US dollar firmed across the board on growing chatter that a June Fed rate hike is imminent, particularly after Wednesday’ hawkish FOMC minutes.

Moreover, a minor pullback witnessed in the Asian equities also curbs the demand for gold as a safe-haven, as risk sentiment improves. The yellow metal has shed 1.4% so far for the week, and is headed for the biggest weekly drop since the week ended March 25.

Nothing of relevance for gold in the day ahead and hence focus will remain on the sentiment surrounding oil and stock markets. Besides, Fed official Tarullo’s speech is due on the cards later tonight.

Gold Technical Levels

The metal has an immediate resistance at 1260 (20-DMA) and 1267.40 (10-DMA). Meanwhile, the support stands at 1250 (psychological levels) below which doors could open for 1243.81 (May 19 Low).