Gold rises to over 1-month tops, above $1605 level

• Gold built on the overnight strong gains and climbed to fresh one-month tops.
• Bulls seemed rather unaffected by stronger USD, a pickup in the US bond yields.

Gold edged higher during the early European session on Wednesday and is currently placed at over one-month tops, around the $1606 region.

Following a brief consolidation through the early part of Wednesday's trading session, the precious metal regained some positive traction and added to the previous session's strong positive move.

Gold unaffected by a combination of negative factors

The commodity on Tuesday rallied hard amid renewed pessimism over deepening economic fallout from the coronavirus outbreak in China, especially after Apple's warning that it will miss the sales target.

Meanwhile, the overnight strong intraday positive momentum seemed rather unaffected by sustained US dollar buying interest, which tends to undermine demand for the dollar-denominated commodity.

The greenback stood tall near multi-month tops and was further supported by a modest pickup in the US Treasury bond yields, albeit did little to prompt any fresh selling around the non-yielding yellow metal.

Bulls even shrugged off receding demand for traditional safe-haven assets, led a recovery in the global risk sentiment amid a slowdown in the number of new cases infected by the deadly virus.

Market participants now look forward to the US economic docket – featuring the release of housing market data and Producer Price Index. This coupled with speeches by influential FOMC members might provide some impetus and produce some meaningful trading opportunities.

Technical levels to watch