The safe-haven-metal erased some of its early losses and took some modest bids around $1,800. Whereas, the gold prices were stuck in a trading range of $1,796 to $1,799 due to mixed clues. However, the reason for the modest gains in the bullion could be attributed to the noise surrounding the record surge in the U.S. coronavirus (COVID-19) cases and the Sino-American tension, which initially favored the yellow-metal.
The broad-based U.S. dollar weakness triggered by the modest upbeat market mood also impressed gold bulls and kept the gold prices bullish. At the moment, the yellow metal prices are currently trading at 1,798.59 and consolidating in the range between 1,796.01 and 1,799.59. Elsewhere, the gains in the S&P 500 Futures backed by the hopes of the potential virus vaccine kept a lid on any additional gold prices.
As per the latest report, Washington state COVID-19 cases rose by 1267 on Thursday to 44313, the highest single daily increase since the pandemic started. Simultaneously, the total number of cases in Texas rose by 10291 on Thursday to a total of 292656. Although, the deaths toll increased by 129 to 3561 total, highest single-day increase, and record increase for the second day in a row. According to Johns Hopkins University data, in the latest numbers, more than 13.5 million people beyond the world have been diagnosed with COVID-19.
Apart from the virus woes, the full-fledged war between the world's top two economies remained on the card as the U.S. policymakers were set to levy heavy sanctions on China's ruling party members. This action will push the dragon nation towards rouge retaliation and the fears of which weighed on the risk-tone sentiment. As in result, the previous optimism, backed by the hopes of the virus vaccine, couldn't stay on the table for long.
Despite the sustained acceleration in the number of coronavirus cases globally and the on-going Sino-American conflict, the market traders cheered optimism at least, backed by the hopes for COVID-19 vaccines coming out of both the U.S. and U.K. that eventually restricted the safe-haven demand.
On the positive side, the U.K. scientists have also reported their breakthrough in vaccine development. A trial for a COVID-19 vaccine being developed by researchers at Oxford University involving 5,000 volunteers is currently underway in Brazil. Pharmaceutical company AstraZeneca (LON: AZN) has also agreed to mass-produce the vaccine.
Furthermore, the U.S., U.K., and Canada accused Russia of stealing coronavirus vaccine research as the pandemic increased across the world, with Brazil surpassing 2 million confirmed cases since March.
In response to this, Dmitry Peskov, a spokesman for President Putin, denied the responsibility and stated that Russia has nothing to do with the struggles of stealing vaccine research by hacking into pharmaceutical companies and research centers in Great Britain.
Despite the ever-increasing number of new coronavirus cases and the better-than-expected U.S. macro releases, the broad-based U.S. dollar failed to gain any positive traction and edged lower on the day. However, the losses in the U.S. dollar could be attributed to the uptick in the U.S. stock futures. The losses in the U.S. kept the gold prices higher as the price of gold is inversely correlated to the U.S. dollar. Whereas, the U.S. Dollar Index that tracks the greenback against a basket of other currencies was down 0.07% to 96.250 by 9:55 PM ET (2:55 AM GMT).
In the absence of significant data/events on the day, the market traders will keep their eyes on the USD price dynamics and coronavirus headlines, which could play a key role in influencing the intraday momentum. As well as, the traders will keep their eyes on the virus updates and news concerning China.
Daily Support and Resistance
S1 1768.31
S2 1784.79
S3 1791.03
Pivot Point 1801.26
R1 1807.51
R2 1817.74
R3 1834.21
The yellow metal gold is gaining important support at 1,795 mark, and breach of this can continue selling bias unto the next support level of 1,790. Gold has lately disrupted the upward trendline on the 4-hour timeframe, suggesting probabilities of selling bias for gold. On the higher side, gold can show bullish retracement unto 1,809 level resistance; above this, the next resistance is expected to be found at 1,814 level. Let's look for bullish trades over 1801.26 and bearish below the same. Good luck!