untitled design

XAU / USD bulls expect a move above the 100-day EMA near the $ 1,790 level

  • Gold gains traction for the second day in a row on Wednesday.
  • Renewed nervousness around COVID-19 provides a modest boost to the safe-haven precious metal.
  • A rally in US bond yields benefits the USD and limits XAU / USD gains.

The price of oro it is moving higher during the first half of trading action on Wednesday, although it lacks strong follow-on buying. The XAU / USD has seen limited around the region of $ 1,785, just below the highs of the previous day.

The precious metal gained traction for the second day in a row on Wednesday and has once again approached the multi-week highs touched earlier this week. Renewed fears about another dangerous wave of coronavirus infections in some countries have turned out to be a key factor that has provided a modest boost to XAU / USD as a safe haven..

This marks the fourth day of positive movement in the previous five, although a combination of factors has limited any additional gains. The bulls have failed again near the 100-day EMA barrier, around the $ 1,790 region, amid a good recovery in US Treasury yields, which tends to drive money flows away from the yellow metal that does not perform.

Meanwhile, a rally in U.S. bond yields has helped the US dollar rebound even further from the seven-week lows hit the previous day. This has been seen as another factor that has limited the earnings of gold, denominated in dollars. That said, the expectations that the Fed will keep rates low for a longer period they should help limit the fall.

The fundamental context favors the bulls and supports the prospects for additional earnings. Even from a technical perspective, last week’s move past the $ 1,760-65 region validated a bullish double-bottom pattern. However, it will be prudent to wait for a sustained breakout above the $ 1,790 region before opening any new bullish bets.

In the absence of major economic releases from the US, investors could continue to pick up signals from the broader market risk sentiment. Apart from this, US bond yields will influence USD price dynamics and contribute to generating some short-term trading opportunities around XAU / USD.

Gold technical levels

.

You may also like

Get the latest

Stay Informed: Get the Latest Updates and Insights

 

Most popular