• Weighed down by resurgent USD post-ADP report.
• Firming December Fed rate hike prospects undermine.
• Focus remains on FOMC announcement.
Gold trimmed some of its early strong gains and has now retreated back below 100-day SMA during the early NA session.
A fresh wave of US Dollar buying interest emerged following the release of upbeat private sector employment details - ADP report, from the US and was seen exerting some fresh pressure on dollar-denominated commodities - like gold.
Adding to this, today's better-than-expected data reaffirmed prospects for a December Fed rate hike and the same is evident from a sharp spike in the US Treasury bond yields, which was further seen driving flows away from the non-yielding yellow metal.
Meanwhile, the pre-FOMC nervousness, partly offsetting the prevalent risk-on mood across global equity markets, underpinned demand for traditional safe-haven assets and helped the precious metal to hold with some minor gains near $1275 level.
Today's US economic docket also features the release of ISM manufacturing PMI, while the key FOMC announcement would help determine the commodity's next leg of directional move.
Technical levels to watch
Immediate support is pegged near $1270 level, below which the metal could extend the fall towards $1267 area before eventually dropping to Oct. monthly lows support near the $1260 region.
On the flip side, renewed strength beyond $1277-78 zone now seems to accelerate the up-move towards $1283-84 supply zone, above which a bout of short-covering could lift the commodity towards $1290 important hurdle.
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