Gold resumed its drop to trade near its lowest level in four months as the rally in equity markets on signs of recovery from the U.S. damped demand on the metal as a safe haven.
Gold prices plunged to record its longest losing streak since November as investors’ risk appetite soared following a parade of upbeat U.S. economic reports which suggested the Fed would continue with its stimulus cut plan and may raise interest rates earlier than predicted.
Both the S&P 500 and Dow Jones Industrial Average closed ata record high on Friday.
Later in the week, eyes will focus on the awaited non-farm payrolls which may show employers added more than 200,000 jobs for a fourth straight month in May.
U.S. ISM manufacturing widened expansion to 55.5 last month from 54.9 in April, according to median estimates for a report due as of 14:00 GMT.
Additionally, data from China released on Sunday signaled a remarkable rise in factory activity at the fastest in five months in May.
In the euro area, the focus this week will be on the ECB’s monetary decision amid expectations the central bank will introduce new measures to stave off the current low inflation.
Meanwhile, gold is trading around $1245.00 an ounce after hitting a high of $1250.62 and a low of $1240.90.
The metal continued to trade below that the fall below $1297.45, which represents Daily SMA 200, where over the recent past weeks the trading remained range bounded.
The downside fall was triggered by the breakout of critical support at $1280, pushing the metal to a weekly loss of 3.37 percent the previous week.
The US dollar rebounded versus a basket of major currencies to hover around 80.50, after touching a bottom of 80.41.
Crude oil for July’s delivery rose to trade around $103.20 a barrel from the session’s opening of $102.88.