Round-trip for gold as US dollar rally continues

Gold continues to lose weight in Asia as the American dollar is on fire and is clocking multi-year high across most majors.

Trades at lowest since February

At $1127/Oz levels, the metal is trading at its lowest since February, which almost marks the completion of the round-trip in gold. The first half of the year was marked by Brexit uncertainty and speculation that Fed may not raise rates at all in 2016.

This pushed gold prices to a yearly high of $1375/Oz levels. However, the financial markets remained remarkably resilient in the second half of the year despite Brexit and Trump victory.  Furthermore, the odds of a faster rate hike in 2017 strengthened, thus the metal dropped.

The move in gold is exactly opposite of the dollar index; which currently trades 1.1% higher on the day at 103.15 levels.

Gold Technical Levels

A break below $1115.58 (Feb low) would expose $1200 (psychological level), under which a major support is seen at $1073.53 (July 2015 low); On the other hand, a breach of the resistance at $1142.99 (Feb high) could yield re-test of $1160 (10-DMA) and $1188.10 (Dec 5 high).