Gold remains vulnerable to deeper pullback analyst Recasts, adds comments, updates prices
May 27 Reuters Gold prices steadied near the 1,900perounce level on Thursday as investors awaited key economic readings out of the United States, while a firmer dollar weighed on bullion prices.
Spot gold was up 0.1 at 1,898.39 per ounce by 0521 GMT, after hitting its highest since Jan. 8 at 1,912.50 on Wednesday.
U.S. gold futures eased 0.2 to 1,900.60 per ounce.
Gold prices reversed back in parallel with the rebounding U.S. dollar. What this suggests is that we are starting to see markets positioning ahead of Fridays PCE report, DailyFX currency strategist Ilya Spivak said, referring to monthly U.S. personal consumption data.
The dollar index rose to a oneweek high against rivals, making gold more expensive for other currency holders.
Market participants now await the monthly U.S. personal consumption report on Friday to gauge inflationary pressure. U.S. gross domestic product and jobless claims numbers are due later in the day.
Federal Reserve officials have recently downplayed rising price pressures and affirmed their support to keep monetary policy accommodative for some time.
Gold remains vulnerable to a deeper pullback as its relative strength index has been overbought for the past few days, which is usually a strong corrective indicator, OANDA senior market analyst Jeffrey Halley said.
However, I dont see gold falling below the 1,875 region ahead of the U.S….