- The predominant selling bias of the USD extended some support to the dollar-denominated commodity.
- Brexit optimism undermined safe-haven assets and kept strong gains for the metal in check.
He oro it traded with a slight positive bias during the middle of the European session, although it lacked a strong follow-up buying. The commodity was last seen hovering around the $ 1,875-76 region, a modest 0.10% gain for the day.
The precious metal rose for a second consecutive session on Thursday, adding to the previous day’s modest gains from the region of $ 1,855, or weekly lows. The rally was sponsored solely by the predominant selling bias of the US dollar, which tends to benefit dollar-denominated commodities.
However, the underlying bullish sentiment in equity markets undermined the XAU / USD as a safe haven and kept strong profits limited. The latest optimism about an impending post-Brexit trade deal partially offset concerns about the discovery of a new variant of the coronavirus that spreads more rapidly and boosted investor sentiment.
Aside from this, relatively tight liquidity conditions ahead of the Christmas holidays prevented investors from making aggressive directional bets. This was also cited as a key factor contributing to moderate / in-range price action amid the absence of relevant US economic releases.
With that said, the incoming Brexit-related headlines, coupled with events related to the coronavirus saga, could instill some volatility in the global financial market. This, in turn, could help traders seize some short-term opportunities.
Technical levels
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