A weaker dollar helped gold extend gains into Tuesday, with investors adjusting positions ahead of policy meetings this week at the Bank of Japan and the U.S. Federal Reserve.
Spot gold XAU= had edged up 0.1 percent to $1,238.76 an ounce by 0051 GMT, after gaining 0.5 percent in the previous session.
The U.S. dollar slipped against the yen on Monday as traders took profits from the greenback's recent rally against the Japanese currency, while the dollar weakened against other major currencies on expectations for a dovish Fed.
Economists expect the Fed to deliver a rate hike in June, and follow up with another by year-end. But interest rate futures show less conviction, underscoring an ongoing wide gap between markets and policymakers on the trajectory of rates.
Assets in SPDR Gold Trust, the largest gold-backed exchange-traded fund, fell 0.3 percent to 802.65 tonnes on Monday, though remained not too far off a two-year high reached earlier this year.
Technically, June gold futures prices closed nearer the session high on a corrective bounce from late last week’s selling pressure. The gold bulls have the overall near-term technical advantage. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at last week’s high of $1,272.40. Bears' next near-term downside price breakout objective is pushing prices below solid technical support at 1,225.00. First resistance is seen at today’s high of $1,243.80 and then at $1,250.00. First support is seen at today’s low of $1,231.30 and then at $1,225.00. Wyckoff’s Market Rating: 6.0
Reference: Reuters, Kitco
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