Gold consolidating recent gains, eyeing NFP for fresh impetus

Gold caught fresh bids at lower level and has now reversed majority of its early lost ground as investors eagerly await for the keenly watched US monthly jobs report.

Currently trading with mildly lower around $1178, spot gold was seen consolidating overnight gains to four week high amid heavy selling pressure surrounding the US Dollar following Wednesday's release of Fed monetary policy meeting. The Fed minutes revealed that policymakers were uncertain about fiscal policies by the incoming Trump administration and its impact on the US economic growth, which in-turn might force the central bank to change its projected interest rate trajectory. 

Meanwhile, retracing treasury bond yields and softer tone around European equity markets is pointing to prevalent cautious sentiment and extended support to the precious metal's safe-haven appeal, helping it to recovery from session lows. 

Later during NA session, the release of monthly jobs report (NFP), which is known to infuse substantial volatility across global financial markets, would derive safe-haven demand and provide some impetus for the yellow metal. This coupled with other US macro releases would help investors determine the greenback's near-term trajectory and eventually drive dollar-denominated commodities - like gold. 

Technical levels to watch

Momentum back above $1180 level is likely to boost the commodity back towards $1185 level (yesterday's high) above which the metal seems all set to head towards testing 50-day SMA resistance near $1195-$1200 region. On the downside, weakness below session low support near $1174 might get extended towards $1165 support, which if broken is likely to accelerate the slide further towards $1150 strong support.