Gold breaks $1250 barrier, drops to 4-month lows

Gold bounced sharply and broke below the $1250 area. After the release of the US employment report the ounce troy of the precious metal advanced to $1265 but lost strength and turned to the downside. During the last hour amid a decline in US stocks and a rally of the USD against commodity currencies, accelerated the decline. 

The bearish momentum was strong enough to push the price below the $1250 barrier. It bottomed at $1240.90, a level last seen back on June 7. From the lows, it rebounded but so far it has been unable to rise back on top of $1250. It was trading at $1247, down 0.70% for the day; from the level it had a week ago, it has fallen more than 5%. So far it is the biggest weekly decline during the current year. 

XAU/USD key levels

To the downside, support levels now might be seen at $1240 (daily low), followed by $1235 (Jul 7 low) and $1223 (Apr 14 low / May 27). On the opposite direction, the area around $1250 could be seen at the immediate resistance followed by $1265 (daily high) and $1277 (Oct 5 high).