Gold trims losses, eyes political developments

Gold prices found takers around Friday’s low of $1323 levels as investors assess the situation in Turkey following a failed military coup attempt over the weekend.

Rejected at 5-DMA

Prices failed to take out 5-DMA level of $1335 in Asia and dipped to $1323 levels before trimming losses to trade around $1330 levels. The safe haven demand for the metal dropped in Asia after failed military coup attempt in Turkey eased political fears.

However, investors fear a backlash from Erdogan government and thus losses in the yellow metal were capped around Friday’s low of $1323. The recovery from the session low was partly aided by 0.20% weakness in the US dollar index as well. Given the data calendar is light across the globe, the metal remains at the mercy of the news flow out of Turkey.

Gold Technical Levels

Prices are attempting to break above $1130.34 (July 12 low) as I write. Acceptance above the same could yield $1135 (5-DMA) above which gains could be extended to 10-DMA level of $1350. On the other hand, a breakdown of support at $1320 (July 14 low) would open doors for a drop to $1300. A violation there could yield $1284 (50-DMA).