Gold price retreats farther from 1-week tops, back closer to $1310 level

London (May 7)  Gold held on to its weaker tone through the mid-European session and is currently placed at the lower end of its daily trading range, around $1312 level.

The precious metal initially built on last week's recovery move from the very important 200-day SMA and touched a one-week high near the $1319 region. However, a strong follow-through US Dollar buying interest prompted some fresh selling around dollar-denominated commodities - like gold.

Meanwhile, a mildly positive tone around the US Treasury bond yields further weighed on the non-yielding yellow metal. Adding to this, buoyant trading sentiment around European equity markets also did little to revive the precious metal's safe-haven demand.

In absence of any major market moving economic releases from the US, speeches by various FOMC members might influence Fed rate hike expectations and eventually provide some meaningful impetus later in the day.

Technical levels to watch

A subsequent retracement back below $1310 level is likely to drag the commodity back towards testing 200-DMA support, currently near the $1305 region, below which the fall could further get extended towards the $1300 handle.

On the flip side, momentum back above $1315 level now seems to assist the metal to surpass the $1319-20 intermediate hurdle and head towards testing 100-day SMA resistance near the $1323-24 region.

FXstreet