• Gold prices is continuing its weakness for second consecutive week. The yellow metal jumped slightly till $1262 and started to decline from that level. US dollar index jumped sharply near 90 pips yesterday and is trading near recent high of 95.5. Any convincing break above will take the pair to next level till 96.39/97. It is curretly trading around 95.46. The major reason for huge decline in gold in the previous week is due to strong US dollar index. The yellow metal declined more than $50 in past two weeks. The slight policy divergence in Fed and ECB is dragging Euro lower. US 2 –year bond yield is trading slightly lower after a minor jump till 2.58% and has declined 0.16% for the day. It is currently trading around 2.50% and 10 year yield is trading `marginally higher at 2.83% 0.11% higher. USDJPY shown a minor jump of 100 pips from the low of 109.36. It is currently trading around 110.26. The yellow metal is currently trading around $1252.50
   
• The major three factors to be watched for gold price movement are

1. US Dollar index – Highly bullish (extremely weak for gold)
    
2. USDJPY- strong   (negative for gold)
    
3. US 10 –year yield – 2.83% (-0.11% for the day neutral for gold)

• The yellow metals near term resistance at $1265 (7- day MA) and any convincing close above will take the yellow metal till $1276 (10- day MA)/ $1284 (20- day MA). 
   
• On the lower side, near term support is around $1260 and any break below will drag the yellow metal down till $1250/$1236.
• ​It is good to sell on rallies around $1258-60 with SL around $1267 for the TP of $1236.