Gold corrects for second consecutive session, awaits NFP for fresh impetus

Gold traded with negative bias for the second consecutive session and extended retracement from one-month highs touched on Wednesday. 

Thursday upbeat US private sector jobs data boosted market expectations for an eventual Fed rate-hike action this month and was seen weighing on the non-yielding precious metal. 

This coupled with strong bullish sentiment surrounding global equity markets further dented the yellow metal's safe-haven appeal and collaborated to the ongoing slide back closer to weekly lows. 

Investors now look forward to the keenly watched US non-farm payrolls data, due later during early NA session for clues over timing of next rate-hike action, which would eventually influence sentiment surrounding the US Dollar and provide fresh impetus for dollar-denominated commodities - like gold. 

   •  US: Nonfarm payrolls are expected to moderate to 180,000 in May – BMO CM

On the flip side, the fact that prices have not dropped significantly so far suggests that investors continue to buy the dips amid political uncertainty ahead of next week's UK general election. Moreover, with global stock markets holding near record high levels, any sharp corrective slide would also push prices significantly higher from current levels. 

Technical levels to watch

On a sustained weakness below $1259 immediate support, the commodity seems more likely to break below $1255 intermediate support and head towards $1250 level en-route the very important 200-day SMA near $1243-42 region.

On the upside, immediate resistance is pegged near $1265-66 region, above which the metal is likely to aim back towards $1270 resistance before eventually darting to its next major hurdle near $1275-76 region.