Safe-haven-metal prices extended its previous day winning streak and rose above mid-$1700 marks due to the doubts on a potential vaccine for the COVID-19 virus. However, the overnight gains in the yellow-metal were supported by the sustained U.S. dollar selling bias. The reason for the gold recovery could also be the Fed Chairman's statement of keeping its interest rates near zero, as lower interest rates reduce the opportunity cost of holding gold. At this particular time, the yellow metal is currently trading at 1,750.49 and is consolidating in the range between 1743.70 and 1751.12.
Gold futures higher 0.44% at $1753.20 by 12: 57AM ET (5:57 AM GMT). Investors turned to the safe-haven yellow metal after destroyed hopes for a COVID-19 vaccine, which turns risk sentiment soured. The Vaccine checking authorities raised doubts about U.S. drug maker Moderna's Monday statement that its potential COVID-19 Vaccine had produced a safe response in all 45 stages. I
In animal trials, the same Vaccine was used, and it failed to stop the infection. Dr. William Haseltine, a former Harvard Medical School professor, said that all six monkeys who participated in the animal trial for that Vaccine had the same amount of virus in their noses as the non-vaccinated monkeys in the trial. This news suggested that the treatment might not stop the spread of deadly coronavirus and thus raised the safe-haven demand and gold prices on Wednesday.
On the other hand, the White House adviser Larry Kudlow's hinted that the U.S. President Donald Trump did not show any willingness to break the deal with china which initially helped risk market, but the Senate Republicans continued to push for investigations about virus outbreak and China's role in it which kept the risk sentiment confused.
Daily Support and Resistance
- S1 1696.22
- S2 1717.95
- S3 1731.38
Pivot Point 1739.67
- R1 1753.1
- R2 1761.4
- R3 1783.12
The XAU/USD prices are gaining support at 1,742 and resistance around 1,452 level as investors seem to face indecision ahead of major economic events this week. Overall, the trading bias seems bullish. Therefore, we may expect gold prices to soar further higher until the next resistance area of 1,762. The RSI stays in the buying mode, while the 50 EMA is also supporting the buying trend. Consider staying bullish today above 1,742 level to target 1,755 and 1,762. Good luck!