Gold remains capped below monthly tops post US housing data

Gold recovered early corrective slide to $1235 region but once again struggled to extend the up-move further beyond monthly tops resistance near $1244-45 region. 

The US Dollar held on to its tepid recovery move after better than expected US housing market data and has been one of the key factors holding the the dollar-denominated commodity - gold, below its monthly tops touched in the previous session. Data released from the US showed both housing starts and building permits rebounded sharply in June and rose more than expected by 8.3% and 7.4% respectively to an annualized pace of 1.215 million and 1.254 million units. 

Adding to this, a modest pickup in the US Treasury bond yields further collaborated towards keeping a lid on the non-yielding yellow metal’s up-move, at least for the time being. 

It would now be interesting to see if the metal is able to clear this important barrier and aim towards extending the up-move beyond 100-day SMA important hurdle amid persistent up-move in the US equity markets, which tends to weigh on traditional safe-haven assets, including gold. 

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Technical levels to watch

Immediate strong resistance remains near 100-day SMA around $1247 region, above which a fresh bout of short covering has the potential to continue boosting the metal further towards its next major hurdle near $1257-58 horizontal area, with some intermediate resistance near $1251-52 zone.

On the flip side, $1235 level now seems to have emerged as immediate support to defend, which if broken could accelerate the slide back towards 200-day SMA support near $1230 region ahead of its next important support near $1226 horizontal level.