On Wednesday, gold prices advanced as the greenback retreated alongside Treasury bond yields after hitting a 13-month high during the day, which has helped the yellow metal make use of its appeal as an anti-fiat and non-interest bearing alternative.

Gold reversed an earlier uptick to 1217 level closer to weekly levels and is currently trading at the lower of its daily trading range, with no firm directional bias. Despite the recent recovery, the precious metal has failed to confirm ay meaningful recovery and remains within a distance of the YTD lows, which was recorded last Friday.

The precious metal seems to be supported by the escalating trade conflicts between the US and China, which are the world’s two largest economies, The aforementioned trade conflicts was to a larger extent dampened by strong expectations about gradual Fed rate hike path, which has been one proponent of keeping a loid of any attempted recovery momentum for the non-yielding yellow metal.

In the meantime, there was a renewed interest in the greenback buying during the early European session, which was the unique reason prompted some fresh negative momentum around the commodity.

U.S. initial weekly U.S. jobless claims fell by 6,000 to a seasonally adjusted 213,000 in the week to Saturday, according to the reports by the government which was less than the popular expectations. Popular expectations from the various new organization had forecasted for initial claims to be around 217,000 to 220,000, while the US Labor Department revised the prior week’s tally to 219,000 from the previously reported 218,000.

Gold prices are trading modestly higher during the early US trading session, with the yellow metal being supported by a lower than expected US producer price index. U.S. producer prices in July were unchanged, versus pre-report expectations for a rise of 0.2% from June. This report is the most significant U.S. economic report so far this week.

Gold 1H Chart
Gold 1H Chart

Bullish Outcome: Above 1221.82 Bollinger band, look for further upside with 1223.53 and 1226.50 in extension.

Bearish Outcome: Below 1221.82 middle Bollinger band, look for further downside with 1220.10 and 1215.80 in extension.