Gold ticks higher on moderate USD weakness

Having survived above $1200/Oz levels last week amid the dollar onslaught, the yellow metal looks poised for a recovery, now trading 0.30% higher on the day around $1212/Oz levels.

US inflation expectations near 2-yr high

The 10-year breakeven inflation rate, which is the difference between the yield on the 10-yr Treasury note and the yield on the 10-yr Treasury Inflation Protected Security (TIPS) rose to near 2-year high on ‘Trump bump’.

Gold prices could correct on the fears of the US economy heating up. Meanwhile, the bullish tone in the US dollar appears to have run out of steam, which is evident from the moderate drop in the USD index. The greenback was last seen trading 0.15% lower around 101.25 against the basket of the currencies.

Gold Technical Levels

A break above the 5-DMA Level of $1218.20 would open doors for a rally to $1241.50 (Oct low) and $1253 (23.6% of 2011 high - 2015 low). On the other hand, a breakdown of the support at $1205 (Asian session low) would expose $1200 (zero figure). Acceptance below the same would suggest a potential for a much deeper sell-off to $1180 (June 2013 low) levels.