Gold capped below $ 1250 as DXY regains poise

Gold prices on Comex stalled its recovery mode in the Asian session and returned to the red zone amid resurgent USD demand across the board,

Gold drops below 10-DMA at $ 1247.63

Currently, gold trades -0.28% lower at fresh session lows of $ 1246.50, moving further away from 200-DMA barrier located at $ 1256.45. The USD bulls are back in command as shorter duration treasury yields regained strength, following the comments from Fed official Brainard, who advocated a  rate hike soon given the improve global conditions and continued growth.

Gold also remains on the back foot after yesterday’s ISM manufacturing data added to the recent signs of strength seen in the US economic recovery, which helped boost the odds for a March Fed rate hike, thus, weighing on the non-interest bearing yellow metal.

The bullion will closely eye developments affecting the USD price-action for further momentum amid a lack of key fundamental drivers due on the cards later today.

Comex Gold Technical Levels                                  

The metal has an immediate resistance at 1256.45 (200-DMA) and 1260 (round figure). Meanwhile, the support stands at 1240.50 (20-DMA) below which doors could open for 1231 (daily S2).