Gold XAU / USD Analysis Tries to Bounce From Monthly Lows to $ 1,860

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  • Gold recovery attempt from $ 1,860, capped below $ 1,875
  • XAU / USD remains weak with the USD rising.
  • The US dollar is recovering on the fears of COVID-19 and the uncertainty of the US elections.

Gold futures They are trying to recover after having depreciated more than 2% in the last two days. The yellow metal has rallied after hitting month-long lows at $ 1,860, although bullish moves are finding sellers in the $ 1,875 region.

Gold sinks as the US dollar rallies

The XAU / USD bearish reversal from the mid-October highs above $ 1,930 accelerated on Wednesday after breaking below last week’s low at the $ 1,890 area.

Gold prices have suffered amid the general strength of the dollar. The combination of market concerns about the impact of the second wave of COVID-19, with Europe introducing new lockdowns and uncertainty regarding the US elections less than a week before Election Day, has strengthened the safe haven dollar against their main peers.

On the macro front, US data has offered some additional support for the dollar today. According to advanced estimates, the U.S. Gross Domestic Product expanded at an annual rate of 33.1% in the third quarter, which is its best performance since records were taken in 1947 and weekly jobless claims declined beyond The expectations.

In Europe, the European Central Bank hinted at more monetary stimulus in December, sending the euro down, benefiting an already strong USD. All in all, the US dollar index shows an advance of 0.6% the day after reaching levels above 94.00 for the first time in October.

Credits: Forex Street

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