Gold halts 4-day losing streak, clings to 5-DMA

Gold is finally trading in the green zone for the first time in five trading sessions so far this Wednesday, as the US dollar corrects lower amid a slightly risk-averse market condition.

Gold stuck below 200-DMA

Currently, gold trades +0.20% higher at 1256.90, having found strong support just ahead of # 1250 barrier. Gold takes on a minor-recovery this Wednesday, and regains 5-DMA barrier amid a better sentiment towards safety assets such gold, after the PBOC devalued yuan sharply and hence, fuelled a risk-aversion wave across the markets.

Moreover, broad based US dollar correction after yesterday’s extensive rally also aids the recovery in the USD-denominated yellow metals. However, the recovery may remain short-lived as the upcoming FOMC meeting minutes may show that the Fed remains on track for a rate rise by the end of this year, which will weigh on the non-interest bearing gold.

Besides, a slew of Fed speaks may also have significant impact on the gold price-action in the day ahead.

Gold Technical Levels                                   

The metal has an immediate resistance at 1260 (round figure) and 1263 (200-DMA). Meanwhile, the support stands at 1250.53 (Oct 11 low) below which doors could open for 1241.36 (4-month lows).