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Gold recovers amid weaker US dollar

FXStreet (Córdoba) - Gold managed to bounce on Thursday after two daily losses and a fresh multi-year low, amid broad US dollar weakness.

Spot gold traded as low as $1,1046 an ounce at the beginning of the day, before finally turning higher following ECB conference, where Draghi fell short of market expectations on providing more stimulus, which ignited a rally on the euro and weighed on the dollar. Gold futures settled around $1,061 an ounce, posting a 0.7% gain on Thursday.

Now investors attention turns to the US nonfarm payrolls tomorrow, which shouldn’t affect liftoff expectations, unless it turns out awful.

Gold technical view

“The commodity, however, trades around 1,1061 at the end of the day, far from suggesting a change in the ongoing bearish trend. From a technical point of view, the daily chart shows that gold has set a lower low and a lower high, whilst remaining below a bearish 20 SMA, as the technical indicators bounce from oversold levels, all of which maintains the risk towards the downside”, said Valeria Bednarik, chief analyst at FXStreet.

Bednarik locates next support levels at 1,050.55, 1,043.60 and 1,035.00, while she sees resistances at 1,067.50, 1,075.50 and 1,082.40.

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