Gold climbs back closer to 1-1/2 week tops ahead of today’s key event/data risks

   •  Risk-on mood/easing trade-tensions denting safe-haven demand and capping gains.
   •  Modest USD uptick/positive US bond yields further collaborate towards capping.
   •  Focus remains on BoE/ECB monetary policy update and the US CPI figures.

Gold reversed an early dip to $1203 area and has now moved within striking distance of 1-1/2 week tops touched yesterday.

A combination of supporting factors provided a strong lift to the precious metal on Wednesday, with bulls managing to finally make it through the key $1200 psychological mark. 

An unexpected decline in the US producer prices, for the first time since Feb. 2017, crimped market expectations for a faster Fed monetary policy tightening cycle and was eventually seen benefitting the non-yielding yellow metal.

The coupled with some renewed US Dollar selling pressure, further aggravated by the news that the US is proposing a new round of trade talks with China, provided an additional boost to the dollar-denominated commodity.

The up-move now seemed lacking any strong follow-through on Thursday and was being capped by fading safe-haven demand amid the prevalent risk-on mood led by easing global trade tensions.

Moreover, investors also seemed reluctant to place any aggressive bets ahead of today's key event risk/economic releases, including central bank decisions (BoE/ECB) and the latest US consumer inflation figures.

Technical levels to watch

The $1207-08 region might continue to act as an immediate resistance, above which the metal seems to aim towards $1213-14 supply zone. On the flip side, any meaningful slide now seems to find immediate support near the $1200 mark, which if broken is likely to accelerate the slide back towards $1192-90 horizontal support.