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Gold hovers near 3-1/2 month highs, $ 1200 on sight

FXStreet (Mumbai) - The yellow metal prolongs its upbeat momentum in Asia, although retreats slightly from fresh three and a half month highs, as a rebound in Asian equities capped the gains in gold.

Gold holds above daily pivot at 1178.80

Currently, gold trades 0.35% higher at 1184, oscillating in a narrow range. Gold prices failed near the H1 R1 and turned lower as the improving risk-appetite amid higher Asian stocks curbed the demand for the precious metal as a safe-haven.

The bullion rose sharply higher on Wednesday and clinched the highest levels in almost four months at 1189 after the poor US retail sales and PPI data reinforced market’s belief that the Fed will not raise rates this year. Gold turns out to be a better alternative higher yielding asset during a low interest rate regime.

Meanwhile, the US dollar continues to remain undermined against its major competitors, with the USD index now trading largely subdued just shy of 94 mark.

Gold Technical Levels

The metal has an immediate resistance at 1189/1190.30 (Oct 14 High & daily R1) and 1200 (round figure). Meanwhile, support stands at 1178.80 (daily pivot) below which doors could open for 1170.11 (hourly 50-SMA).

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