Gold inched lower on Tuesday, dragging the price of yellow metal to less than $1215 an ounce, following the release of some key economic news. The technical bias remains bearish because of a lower low in the recent downside move.

Technical Analysis

As of this writing, the yellow metal is being traded around $1214 an ounce. A hurdle can be noted near $1240.58, the horizontal l resistance area  ahead of  $1275, the trendline resistance area and then  $1300, the psychological number as demonstrated in the given below daily chart.

On the downside, a support can be noted near $1171, the trendline support area ahead of $1150-$1156, the confluence of psychological number as well as horizontal support area and then $1133, the lower trendline support zone. The technical bias shall remain bearish as long as the $1337 resistance area is intact.

US Manufacturing

Activity in the US manufacturing sector increased more than expected in January as new orders expanded at their quickest pace since September 2014, according to preliminary data released on Tuesday. In a report, market research group Markit said that its flash manufacturing purchasing managers’ index (PMI) rose to 55.1 in January from the prior month’s final reading of 54.3. That was its strongest reading since March 2015. Analysts had expected only slight increase to 54.5. On the index, a reading above 50.0 indicates expansion, below indicates contraction.

Trade Idea

Considering the overall technical and fundamental outlook, selling the precious metal around current levels appears to be a good strategy in short to medium term.