Gold retreats after hitting two-month highs

Gold gained some fresh traction at the start of a new trading week and rose to the highest level in two-month. 

Trump's inaugural speech failed to impress the markets and uncertainty around his proposed fiscal policy measures continues to weigh on the US Dollar, thus, boosting demand for dollar-denominated commodities - like Gold. This coupled with weaker sentiment surrounding equity markets is lending additional support to the yellow metal's safe-haven appeal and collaborating to the bid tone. 

The upward trajectory, however, lacked conviction amid growing prospects of additional Fed rate-hike action in 2017, following last week's optimistic rhetoric from the Fed Chair Janet Yellen. Higher US interest-rates tend to drive flows away from non-yielding precious metal. 

Nevertheless, the yellow metal traded with positive bias for ninth session in the previous ten, albeit has retreated from session peak level of $1219.50 level and is currently trading around $1214 region.

Technical levels to watch

Immediate support is pegged at session low near $1210 level below which the commodity is likely to head back towards $1202-1200 strong support area. A follow through weakness back below $1200 mark is likely to accelerate the slide towards $1190-88 support area with $1195-94 zone providing some intermediate support.

On the flip side, sustained move above session peak resistance near $1219-20 area now seems to pave way for continuation of the metal near-term upward towards 100-day SMA hurdle near $1235 region. Intermediate resistance on the upside is seen at $1230 horizontal level.