Gold refreshes session lows as USD gains traction

   •  Fails to build on recovery back above 100-DMA.
   •  Weighed down by recovering US bond yields and USD.

Gold finally moved out of its Asian session consolidation phase and touched a fresh session low level of $1272 in the past hour.

The metal stalled its recent recovery move and failed to build on its up-move back above 100-day SMA. A modest recovery in the US Treasury bond yields backed the US Dollar's goodish recovery move from lows and was eventually seen driving flows away from the non-yielding yellow metal.

Meanwhile, possibilities of some short-term stops being triggered, on a sustained retracement back below the $1275 region (100-day SMA), seems to have further aggravated the selling pressure and collaborated to the commodity's sharp slide over the past hour or so. 

Even the prevalent cautious sentiment around equity markets failed to revive safe-haven demand, with the precious metal now eroding all of its previous session's modest recovery gains. 

Traders now look forward to the US economic docket, which would influence the USD price-dynamics and provide some short-term impetus for dollar-denominated commodities - like gold. 

Technical levels to watch

A follow-through weakness could get extended towards $1268-67 intermediate zone, below which the metal seems vulnerable to aim towards testing $1260 important support.

On the upside, momentum back above $1275 area might continue to confront fresh supply near the $1278-79 region, which if cleared might trigger a short-covering bounce towards $1283-84 supply zone.