Gold extends slide and falls below $1280/oz

The yellow metal eased yesterday’s gains and dropped below $1,280/oz approaching weekly lows. 

Stronger USD pushed gold lower 

Positive expectations that Trump’s administration will be able to introduce its tax reform plan triggered a rally of the US dollar across the board late on Thursday. The bullish tone around the US dollar remained intact over Friday. Equity prices hit new record highs in Wall Street and US bond yield rose. The 10-year yield climbed from 2.32% to 2.38%, the highest intraday level since October 6; moving closer to the key resistance at 2.40%. 

Gold opened the day slightly above $1,290 before turning to the downside. Recently hit a fresh low at $1,278.30 and it was under pressure, near the lows. So far during the week lost 1.70%, moving back to the 20-week moving average after being rejected from above $1,300 on Monday. The metal is now closer to Thursday low located at $1,276. 

XAU/USD key levels

To the downside, support levels might be located at $1,276 (Oct 18 low), $1,270 (Oct 4 low) and  $1,265. On the upside, immediate resistance is seen at $1,282 followed by $1,291 (Oct 20 high) and the $1,300 zone.