Gold turns negative as oil rallies

Gold prices turned negative as corrective rally in oil, coupled with a n upbeat China services PMI data calmed market nerves and capped safe haven demand.

Eyes 50-DMA

Prices appear on track to test 50-DMA support at $1219.05 levels. Correlation between gold and oil is back in the limelight as slide in oil in previous two sessions saw the yellow metal strengthen on the back of safe haven demand.

Oil is up today as markets expect a bullish supply data out of US. This is also helping equity markets in Europe avoid another sell-off. Consequently, the bid tone around metal has weakened.

Prices currently trade around $1225/Oz levels after having clocked a high of $1232.70 levels.

Gold Technical Levels

A break below immediate support at $1219.05 (50-DMA) would open doors for a slide to $1207.69 (Mar 28 low) and 1200 levels. On the higher side, violation at $1244.12 (Mar 30 high) would expose $1253.32 (Feb 24 high) and $1260 (Mar 22 high).