Gold failed to capitalize on the early uptick to near one-month tops and retreated below the 1300 psychological level during yesterday's session. The precious metal has now eroded a part of the previous session's goodish up-move that came after China announced a retaliatory tariff-hike on $60 billion worth of US goods. However, some positive comments by the US President Donald Trump, saying that he feels the Chinese trade negotiations will be successful, helped eased concerns about a full-blown US-China trade war and dampened the precious metal safe-haven status. The broader market risk sentiment might continue to play a key role in influencing the commodity's price action which can produce some short-term trading opportunities.
After surging to a 1-month high on Tuesday, Gold prices retreated as expected below the $1300 psychological level to retest the $1295.36 support level which played well its part. The price is currently trading just below the $1297 level as the momentum started to pick up again. The upside potential is very probable as the traction remained positive, however, we have to be careful from a potential divergence between the price and the momentum. The next level to watch will be the $1303 resistance level.
Support: 1282.19/ 1280.11
Resistance: 1285.35/ 1288.35