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Gold nears four-week low; time to buy?

With Eid a couple of days away, price of gold in Dubai has been dipping

Gold edged lower on Monday to touch a near four-week low as the dollar held firm, with the market waiting on comments from a top US Federal Reserve official after last week's soft economic data.
The price of 24k gold dropped to Dh151.75 in Dubai and 22k can be bought at Dh142.50.
New York Fed President William Dudley, a close ally of Fed Chair Janet Yellen, is due to take part in a roundtable with local business leaders in Plattsburgh, New York. "If Dudley confirms that the Fed will remain hawkish towards
interest rate hikes, I do not think gold will be able to recover anytime soon," said Argonaut Securities analyst Helen Lau.
Spot gold fell 0.1 percent to $1,252.40 per ounce as of 0428 GMT. It hit a fresh low of $1,250.80 during the session, its lowest since May 24.
US gold futures for August delivery fell 0.2 percent to $1,254.20 an ounce. Although the Fed raised rates last week, weaker economic data has cast doubts over the central bank's ability to pursue an aggressive monetary policy for the rest of the year.

US homebuilding fell for a third straight month in May to the lowest level in eight months as construction activity declined broadly, suggesting that housing could be a drag on economic growth in the second quarter.
Higher interest rates tend to boost the dollar, putting pressure on gold prices by increasing the opportunity cost of holding non-yielding bullion.
Check the latest gold rates in Dubai
Spot gold is expected to drop to $1,243 per ounce, as suggested by its wave pattern and a Fibonacci projection analysis, according to Reuters technicals analyst, Wang Tao. 

Gold is likely to be tested on the downside for at least the first half of the week, Alex Thorndike, a trader at MKS PAMP Group, said in a note.
Hedge funds and money managers raised their net long position in COMEX gold for the third straight week to the highest in seven months in the week to June 6, and upped it slightly in silver, US Commodity Futures Trading Commission data showed on Friday.
In wider markets, the dollar was steady against a basket of currencies on Monday, and Asian stocks rose, shaking off Wall Street's uninspiring performance on Friday.
Among other metals, spot palladium was up 1.3 percent to $872.83, and platinum rose 0.4 percent to $928 per ounce. Silver rose 0.6 percent to $16.68 per ounce. It hit a low of $16.575 during the session, its weakest since May 19.