Gold ends five-days of losing streak, stages a minor recovery to $1320

Gold ended its five days of losing streak on Wednesday and staged a minor recovery, erasing part of losses recorded in the prior session.

Currently trading at $1322, the yellow metal on Tuesday touched a seven day low level of $1315 weighed down by broad based USD strength. Even a sell-off in equities, which usually support demand for traditional safe-haven assets - like gold, failed to halt the metal's slide for the fifth consecutive session. 

On Wednesday, a minor retracement in the greenback, as measured by the overall US Dollar Index, was seen boosting demand for dollar-denominated commodities and helping the precious metal to stage a minor recovery. 

As we enter into the official blackout period, ahead of September Fed monetary policy meeting, the incoming US economic data, especially Friday's CPI release, would help investors to determine the next leg of move for gold heading into the next week's major event risk. In the meantime, the metal is likely to derive its move from sentiment surrounding the greenback. 

Technical levels to watch

Immediate upside resistance is seen at $1325, $1328 (20-day SMA) followed by resistance at $1330 level above which the metal seems to extend its recovery trend towards $1340 horizontal resistance. On the flip side, sustained weakness below $1315 immediate support is likely to drag the commodity towards 100-day SMA support near $1304 region, which if broken decisively should trigger a fresh leg of weakness in the near-term.