Gold clings to $1,200/oz

Gold tested fresh lows on Tuesday, with spot falling down to $1,190.89 an ounce at the beginning of the day, as Asian shares rose. But the commodity began recovering ground as market sentiment turned around and oil plummeted.

However, the intraday recovery stalled around $1,217 mid American session, where the base metal turned back south amid broad dollar's strength. The yellow metal is holding above $1,200.00 an ounce but poised to close its third straight day into the red, extending a pullback from last week’s highs above $1,263/oz.

Gold technical perspective

“In the daily chart, the technical indicators continued correcting overbought readings, but remain nearby while the 20 SMA advanced further below the current level, now around 1,160.00”, said Valeria Bednarik, chief analyst at FXStreet. “Shorter term, the 4 hours chart suggest the commodity may retest the mentioned low, as the intraday recovery stalled below a bearish 20 SMA, while the technical indicators resumed their declines within bearish territory, and after correcting oversold readings”.

Support levels: 1,202.05 1,190.90 1,182.60. Resistance levels: 1,214.60 1,223.90 1,233.20.