The yellow metal prices stopped its previous day sharp declines and recovered from the $1,863.24, the lowest level since July 23 to $1,940 level. The yellow metal keeps a $1,900 mark mainly due to the broad-based US dollar weakness, triggered by the inability to reach a consensus for the country's latest COVID-19 stimulus package.
The mixed market sentiment, driven by multiple factors, also tends to underpin the yellow metal prices. In the meantime, the positive news over a potential COVID-19 vaccine or upbeat promises from President Donald Trump becomes the key factor that capping the further upside for the bullion. At the moment, the yellow metal prices are currently trading at 1,926.28 and consolidating in the range between 1,913.05 - 1,942.65.
The failure of the American lawmakers to offer any announcement on the coronavirus (COVID-19) relief package or the recent levies attacks on Europe will not forget President Donald Trump's upbeat promises; the United States remains in the market focus. The US Trade Representative (USTR) Robert Lighthizer raises levies on France and Germany while marked the same for Greece and the UK, which eventually stopped the previous day market upbeat performance and gave some support to the safe-haven metal. Besides, the market risk sentiment was further bolstered by the comments from the US Treasury Secretary Steve Mnuchin, suggested additional difficulties for Senate discussions concerning the much-needed stimulus.
On the other hand, the reasons for the mixed trading sentiment could be attributed to the renewed geopolitical tension, triggered after the US administration's show of powers, through sending stealth bombers near Taiwan, to fight the Chinese threat by showcasing nuclear weapons. As well as, the US Central Command's tweet suggesting the Iranian Navy overtaking a ship called "Wila" also increased the geopolitical tension, which eventually considered negative for the trading market.
Daily Technical Levels
Pivot point: 1928.07
Speaking about gold's technical side, the precious metal is likely to find support at 1,908 - 1,957 level. It seems like the traders are waiting for any significant economic release before determining further trends. Anyhow, the violation of the 1,956 level can trigger more buying until the 1,979 level. While the closing of candle below 1,908 level can trigger a sell-off until 1,870 level. Let's wait for a breakout before placing any further trade. Good luck!