- Gold manages to find some support near multi-month lows around the $ 1,677-76 region.
- A modest pullback in the USD and a softer tone in the stock markets benefits the precious metal.
- The optimistic US economic outlook and a rebound in US bond yields should limit the rise.
The oro it moves between tepid gains and minor losses throughout the European session on Wednesday, consolidating the fall of the previous day near the annual lows.
Following the recent sharp rise to four-month highs, the US dollar has witnessed some profit taking. This has been seen as one of the key factors that have benefited the prices of gold, denominated in dollars. Apart of this, a softer tone around equity markets has offered some more support to the safe-haven XAU / SUDalthough the optimistic US economic outlook has limited any significant recovery.
The impressive rate of vaccination and the spending plan of the President of the United States, Joe Biden, have fueled expectations about a relatively faster economic recovery in the United States. In fact, Biden has announced the opening of the COVID-19 vaccine program for 90% of American adults by April 19 and will describe the details about his infrastructure spending plan of around $ 3 trillion later on Wednesday.
This, along with a modest rally in US Treasury yields should help limit the USD’s corrective slide and limit gains for the yellow metal that does not pay. This makes it prudent to wait for some solid continuation buying before confirming that the XAU / USD has formed a solid foundation near the $ 1,677-76 region and positioning itself for any significant bullish moves in the near term.
Market participants are now awaiting the US economic calendar, which includes the release of the ADP report on private sector employment, Chicago PMI and pending home sales data later at the start of the American session. . Investors will also be guided by news on US fiscal stimulus, US bond yields, and USD price dynamics to seize some near-term opportunities around XAU / USD.
Gold technical levels
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