NEW YORK (Scrap Register): Gold, which has been pummeled by a broadly stronger U.S. dollar so far this week, remains on the defensive, said Lukman Otunuga, research analyst at FXTM.
The bearish price action witnessed in recent weeks despite the growing risk aversion continues to suggest that gold is still losing its safe-haven allure, the analyst said.
Bulls have simply failed to garner any support from global trade concerns and this continues to be reflected in prices. With an appreciating dollar and expectations of higher U.S. interest rates eroding appetite for the metal, the outlook remains tilted to the downside.
Technically, a solid breakdown below $1,240 could encourage a decline towards $1,236 and $1,230, respectively, Otunuga concluded.