Gold hangs closer to 8-week lows, awaits NFP for fresh impetus

Gold priced held weaker for the second consecutive session on Friday and remained within striking distance of nearly two-month lows touched on Wednesday.

A modest US Dollar recovery on Friday weighed on dollar-denominated commodities - like gold. Adding to this, rising global bond yields continue to dent demand for the non-yielding commodity and further collaborated the weaker sentiment surrounding the precious metal, which has been trending lower over the past two-week after the ECB, BOE and BOC hinted towards a tighter monetary policy.

However, the prevalent risk-off environment, led by escalating geopolitical tension surrounding the Korean peninsula was seen extending some support to the yellow metal's safe-haven appeal and helped limit losses, at least for the time being. 

Investors now await the release of keenly watched US non-farm payrolls data, later during the NA session. Against the backdrop of recent sluggish inflation, the key focus would be on the wage growth data that could have an impact on the Federal Reserve's path of monetary policy tightening and would determine the metal's near-term trajectory. 

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Technical levels to watch

Currently trading around $1222 region, a sustained weakness below $1218 level could aggravate the selling pressure and continue dragging the commodity further towards $1207-06 intermediate support en-route the $1200 handle.

On the upside, any recovery attempts might continue to face some fresh supply near $1228-30 area, above which the metal could extend tepid recovery towards the very important 200-day SMA resistance near $1233-35 region.