Gold struggles to build on Friday's modest rebound from 2-week lows
• A modest USD recovery/positive US bond yields prompt some fresh selling.
• Improving risk-appetite does little to revive safe-haven demand and lend support.
Gold held on to its weaker tone through the early European session on Monday and eroded a part of Friday's goodish recovery move from over 2-week lows.
Concerns over US-China trade tensions and disappointing headline NFP print prompted some fresh US Dollar selling on Friday and helped the precious metal to bounce off sharply from $1320 area.
The USD selling pressure abated at the start of a new trading week and prompted some fresh selling around dollar-denominated commodities - like gold. This coupled with a goodish pickup in the US Treasury bond yields exerted some additional downward pressure on the non-yielding yellow metal.
Meanwhile, a positive trading sentiment around European equity markets, pointing to improving investors' appetite for riskier assets, did little to revive the precious metal's safe-haven appeal and further collaborated to the weaker tone.
From a technical perspective, Friday's bounce seemed more of a corrective in nature and hence, a fresh bout of selling pressure, leading to weakness back below $1325 immediate support, now seems a distinct possibility.
In absence of any major market moving economic releases, the commodity remains at the mercy of broader market risk sentiment and the USD/US bond yield dynamics.
Technical levels to watch
A follow-through weakness back below the mentioned support has the potential to drag the metal back towards $1320 intermediate support en-route upward sloping 100-day SMA support near the $1312 region.
On the upside, $1333-35 area now seems to have emerged as an immediate hurdle, which if cleared might prompt some fresh short-covering and lift the metal back towards $1341 intermediate resistance ahead of $1346-48 supply zone.