FxWirePro: Gold trades higher on weak US dollar, good to buy on dips

• Gold has declined sharply after release of US consumer price data. The yellow metal dipped almost $20 from the high of $1336 made before release of US data. The commodity shown a massive recovery from the low of $1317. The yellow metal jumped almost $30 on account of weak US dollar. It hits high of $1355 and is current trading around $1354.50.
   
• The yellow metal recovery was mainly due to strong selling in US dollar index. US dollar index declined almost 100 pips from the yesterday minor top at 90.12. US CPI data came at 0.5% for the month of Jan compared to 0.2% in the previous month. Investors digested the better thane expected US inflation data.
   
• On the lower side, any break below $1343 (23.6% fib) will drag the gold down till $1336 (100- 4H MA)/$1330/$1320. Bearish continuation only if it breaks below $1305 level.
   
• The near term resistance is around $1357 and any close above will take the commodity till $1360/$1366. Overall bullish continuation only above $1366.

It is good to buy on dips around $1348-50 with SL around $1343 for the TP of $1365.