Gold rebounds in Asia, but stays below 5-DMA - NFP eyed (06/05/16)
The yellow metal caught a fresh bid-wave in the Asian session, staging a recovery from four back-to-back sessions of losses ahead of the highly influential US jobs data.
Gold flirts with $ 1280 barrier
Currently, gold jumps +0.11% to 1280, hovering close to fresh session highs reached at 1280.61 last minutes. The bullion picked-up significant strength in the last hour as the Asian equities tumbled on the back of overnight weakness in the oil prices, boosting the safe-haven bids for gold.
Adding to the upbeat tone around gold, markets resort to covering their short positions after the recent sell-off, in a bid to minimize risks ahead of the key US macro data, NFP, due later in the NA session. Markets are expecting a robust 200,000 increase in payrolls coupled with a respectable 0.3% gain in hourly wages.
The US jobs report is expected to provide fresh hints on a June Fed rate hike outlook, especially after recent string of hawkish Fed speaks, which pointed towards a June Fed hike.
Gold Technical Levels
The metal has an immediate resistance at 1283.13/85 (5-DMA) and 1301.79/03.79 (multi-month tops). Meanwhile, the support stands at 1275 (round figure) below which doors could open for 1265 (Apr 29 Low).