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Gold languishes near session low despite drop in US personal spending

FXStreet (Mumbai) - Gold prices continue to trade near the session low of USD 1267/Oz levels, after the data in the US showed personal spending at the weakest since 2009.

Gold falls to 5-weekly MA

The yellow metal fell to the 5-week moving average located at USD 1269.20/Oz levels despite the contraction in the Chinese manufacturing activity and a drop in the US personal spending in December. Consumer spending dropped 0.3 percent after a downwardly revised 0.5 percent increase in November. However, gains may have been capped due to a 0.3% personal income in December.

Gold may extend drop if the US ISM manufacturing figure for January beats the expected figure of 55.00.

Gold Technical Levels

The metal currently trades 0.71% lower at USD 1270.10/Oz levels. The immediate support is seen at 1266.29 (50-weekly MA), under which losses could be extended to 1255.1 levels. Meanwhile, resistance is seen at 1273.6 and 1284.24 (hourly 200-SMA) levels.

Strong print for US manufacturing PMI, but signs of cooling

The final seasonally adjusted Markit U.S. Manufacturing Purchasing Managers’ Index came in at 53.9, signalling a robust improvement in overall business conditions. However, the headline PMI was unchanged since December and the joint lowest for a year, thereby indicating that growth momentum across the manufacturing sector has cooled from the peaks seen in the summer of 2014.
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