Gold remains under pressure amid uncertainty from the euro area

Gold remained under pressure on Wednesday trading amid uncertainty clouding the outlook of the euro area after the rise in Spanish bond yields at an auction yesterday.

Yesterday, a Spanish debt auction saw a rise in yields as the selling of 12- month notes recorded a rise to 2.62% from 1.42% at an auction on March 20, while the 18-month securities produced a yield of 3.11% versus 1.71% at a prior auction, yet some of the tensions eased with the rise in demand at the auction and the rise in German inventor confidence above expectations.

The focus today will be on a two-year German bond sale while Spain will sell 3.3% two-year bills and 5.85% 10-year securities tomorrow.

Worries are still persisting that the ongoing rise in Spanish borrowing will eventually lead to asking for an international bailout like Greece, Portugal and Ireland.

This week, euro area officials will seek global assistance when they conduct talks with the IMF in Washington.

The yellow metal is currently trading around $1650.70 an ounce where it is expected to find found support at $1640, otherwise it will head for a fourth consecutive daily drop. The day's high was recorded at $1654.25 and the low was seen at $1649.02.

In the FX market, the U.S. dollar is currently hovering around 79.55 against a basket of major currencies as depicted by the dollar index, after facing strong resistance at 76.60, which represents SMA level, where the retreat below support of 80.00 on Monday caused to the dollar to drop.

Crude oil for May's delivery is meanwhile showing a slight rise for a third day to trade around $104.35 a barrel after opening today's trades at $104.26.