Gold steadies in Asia amid dwindling Fed rate hike bets

Gold hovered near the highest levels in five-days as the bulls consolidate the non-farm payrolls aftermath.

Gold remains capped below 20-DMA at $ 1332.56

Currently, gold trades modestly flat at 1324.40, having posted day’s high at 1325 and day’ low at 1321.80. The yellow metal staged a solid comeback on Friday after disappointing US payrolls data weighed heavily on Dec rate hike expectations, and thus, benefited the non-interest bearing gold.

As per the CME Fed Watch tool, December Fed rate hike bets dropped to coin toss levels, while Sept rate hike expectations were completely priced-out after the NFP came in at mere 151k versus 180k expectations and 275k previous.

While better-than expected China services PMI report eased concerns over the troubled Chinese economic outlook and underpinned the sentiment around the bullion somewhat. China is the world’s largest consumer of the yellow metal.

In the day ahead, gold prices are likely to extend its upside consolidation amid low volumes and minimal volatility as the US markets are closed on account of Labour Day.

Gold Technical Levels                                   

The metal has an immediate resistance at 1332.56 (20-DMA) and 1340 (round number). Meanwhile, the support stands at 1317 (5-DMA) below which doors could open for 1302.50 (Sept 1 low).