Gold continues to erase gains, closes in on $1230 after US GDP data

• The first estimate of Q3 GDP growth in the U.S. comes in at 3.5%.
• US Dollar Index stays in the positive territory above 96.50.
• Attention turns to Wall Street's opening bell.

After advancing to a daily high of $1238, the XAU/USD pair lost its traction and started to erase its gains as USD strength weighed on the pair. As of writing, the troy ounce of the precious metal was trading at $1233, adding 0.1% on a daily basis.

Earlier in the day, the risk-off mood allowed safe-havens to find demand. Major European equity indices are recording sharp losses with Germany's DAX and the UK's FTSE both losing around 1% to reflect the weak appetite for risky assets. However, the broad-based USD strength didn't allow the pair to preserve its momentum. Ahead of the GDP data from the U.S., the DXY advanced to its highest level since August 15 at 96.86.

Although the data released by the U.S. Bureau of Economic Analysis revealed that the first estimate of the annualized real GDP growth eased to 3.5% in Q3 from 4.2% in Q2 to beat the analysts' estimate of 3.3%, the greenback's reaction was muted. As investors are waiting for the Wall Street's opening bell to see how stocks response to the data, the DXY adds 0.23% on the day at 96.80.

Technical levels to consider

The initial support for the pair aligns at $1222 (Oct. 24 low) ahead of $1215 (Oct. 12 low) and $1205 (50-DMA). On the upside, resistances could be seen at $1235 (Oct. 24 high), $1240 (Oct. 24 high) and $1248 (Jul. 12 high).