Gold: Soft start to the week, supported at $ 1071

By FXStreet FXStreet (Mumbai) – Gold prices re-opened a holiday-shortened week on a weaker note, falling sharply as Japanese traders favoured risky assets such as equities amid low volumes and limited volatility.

Gold holds above 1070 barrier

Currently, gold drops -0.30% to 1072.80, recovering from session lows struck at 1071 earlier this session. Gold’s recovery from post-FOMC slump lost steam just shy of 50-DMA near 1079 last week and the bullion continues to drift lower heading towards the New Year, as markets remain wary over further interest hikes by the Fed in 2016, dampening the sentiment around the non-interest bearing yellow metal.

Meanwhile, positive sentiment on the Asian indices also weighed on gold, with the Nikkei gaining 0.21% and the Chinese benchmark, the Shanghai Composite index advancing 0.41% so far. Looking ahead, limited economic news from the US are expected this week and hence, gold prices are expected to remain in narrow range amid light trading.

Gold Technical Levels

The metal has an immediate resistance at 1075.90 (Today’s High) 1080 (round number). Meanwhile, the support stands at 1061.50 (Dec 16 Low), below which doors could open for 1058.20 (Dec 15 Low).
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Source:: FX Street