Gold faces strong support around 300- day EMA, any break below targets $1261

Gold is trading weak for 4th consecutive week and lost nearly $40 from high of $1310 made previous week.Yesterday yellow metal shown a minor recovery till $1279.70. The decline in yellow metal mainly due to strong dollar and easing US –China trade tensions. US dollar index recovered sharply and jumped more than 70 pips till 97.49 from low of 96.79. The yellow meal hits low of $1271 and is currently trading around $1274.25.

US10 yield is consolidating after a more than 11% jump from 14 month low and hits high of 2.616%. It is currently trading around 2.58%.

On the lower side, near term major support is around $1272 (300- day EMA) and any break below will take the yellow metal down till $1260 (200- day MA)/$1243.

The near term resistance is around $1281 (23.6% fib) and any violation above will take the gold till $1285/$1292. Any convincing break above $1292 confirms minor bullishness and a jump till $1296/$1300 possible.

It is good to sell on rallies around $1277-78 with SL $1283 for the TP of $1261.