"We will see market resistance until we see some catalyst that will give some boost to safe-haven assets," said Kyle Rodda, a market analyst at IG, Australia. "The Fed had said earlier they would raise interest rates based on data ... So, the weaker economic data has supported gold prices," said Brian Lan, managing director at dealer GoldSilver Central in Singapore.
If gold can break the $1,298 level, $1,300 would not be difficult to achieve, Lan added. Gold tends to gain on expectations of lower interest rates, as they reduce the opportunity cost of holding non-yielding bullion. Lower interest rates also tend to weigh on US yields and the dollar, in which gold is priced.
Spot gold looks neutral in a range of $1,285-$1,299 per ounce, and an escape could suggest a direction, according to Reuters technical analyst Wang Tao. Markets will be keenly looking out for any progress in Brexit negotiations as Britain's parliament will vote on Prime Minister Theresa May's deal, which already looks set to be rejected by lawmakers. "If anything goes wrong in today's meeting, it will be supportive of gold," said Kunal Shah, head of research at Nirmal Bang Commodities in Mumbai, India.