Gold nearing $1,300/oz on strong USD demand

• Gold is hurt by exceptional US Dollar demand as traders anticipate a rate hike in June. 
• The ISM's Price Paid index for April rose to 79.3 adding to the bullish pressure on US Dollar.

Gold is trading at around $1,305 a troy ounce down 0.74% in Tuesday’s trading as the precious metal is trading lower for the 9th consecutive day.  

Gold bears are in control as the US dollar demand is hurting gold prices. The buck is having a boost across the board as investors are speculating that the Federal Reserve will indicate the gradual part of monetary policy normalization that translates to an indication of June rate hike as the policymakers meet on Wednesday at 18:00 GMT.

Higher US Treasury yields, the stronger US Dollar and the anticipation of three to four rate hikes in 2018 are pushing investors to lighten their non-yielding gold positions and turn to the US dollar.

Earlier in the day, the US ISM (Institute for Supply Management) Price Paid for April rose to 79.3 beating analysts expectations of 78 in April. Raw materials prices are trending higher for the 26th consecutive month, sending inflation prospects higher.

Meanwhile, on the geopolitical front, the talks of denuclearization between North and South Korea also adds to the gold bearish pressure. The yellow metal is considered a safe-haven asset in time on diplomatic turmoil. 

Gold 4-hour chart 

Gold trend is bearish and resistance is seen at the 1,315 and 1,320 supply level while immediate support is priced in at 1,300 and at 1,270 demand level.