Gold was turned back by resistance at a price of $1,180 on Friday afternoon but remains just below that level after the dollar softened slightly.
The spot gold price was last at $1,176.50/1,177.30 per ounce, still up $16.50 on Thursday’s close but down from an intraday peak of $1,180.20.
While a second test of that key level is not out of the question while prices are hovering just below it, that fact that $1,180 has been tested and has held suggests gold will struggle to break and hold comfortably above that level.
“For now it does look as though the $1,180 resistance was challenged but supply dominated. Prices often challenge a breakdown level, which gold has done twice now – last Friday and again today. If it does not break through soon, it may well trigger more stale long liquidation,” FastMarkets’ William Adams said.
“Watch out in case gold is just feigning a pullback and is ready to strike again,” he added.
The boost in prices comes as the dollar has softened at 1.2520 against the euro despite forecast-beating US retail sales growth at 0.3 percent and UoM preliminary consumer sentiment at 89.4, which was better than the predicted 87.3.
(Editing by Mark Shaw)