Gold snaps 3-year losing streak heading into 2017

Gold prices remain on the back foot, as we step into the first trading day of 2017, lacking momentum amid holiday-thinned light trading.

Currently, gold trades marginally lower below $ 1150 levels, although remains well support above 5-DMA located at 1148.55. The bullion extends its weakness from the final trading day of 2016, as a lack of fresh economic news and low liquidity leaves gold confined within a tight range. Most major markets are close today, in wake of observed New Year holiday.

Meanwhile, gold ended the year 2016 with a more-than 8% gain, registering its biggest increase since 2011. Going forward, gold could witness a solid comeback as a ‘flight to safety’ theme could resurface should the Trump’s presidency disappoint markets’ expectations of more fiscal spending and revival in the US economic growth.

XAU/USD Technical Levels                           

The metal has an immediate resistance at 1155 (key resistance) and 1163 (2-week highs). Meanwhile, the support stands at 1148.55 (5-DMA) below which doors could open for 1140 (10-DMA).