Gold: Downside is more compelling while below $1900
|Gold’s (XAU/USD) rebound from six-week lows of $1850 faltered near the $1891 barrier on Tuesday, although the spot managed to hold on to the recovery gains. The bright metal settled the day around $1878 levels as bulls are losing conviction while below $1900, FXStreet’s Dhwani Mehta reports.
Key quotes
“Amid a partial US market holiday this Wednesday, gold wavers in familiar ranges below the $1891 critical resistance, underpinned by renewed hopes of additional fiscal and monetary policy stimulus to spur the global economic growth.”
“Surging coronavirus cases in the US and Europe could threaten the economic recovery worldwide, rekindling additional stimulus expectations. However, should the virus concerns aggravate and translate into broad risk-aversion, the US dollar could pick up bids as a safe-haven, rendering gold-negative.”
“The bearish 50-HMA resistance at $1889 will offer immediate resistance, above which the bulls need to take out the horizontal 200-HMA hurdle at $1903 to reviving the recovery momentum.”
“Acceptance below powerful support of $1878 could expose the previous month low of $1860. The next downside target awaits at $1850-49, the November 9 low and September 28 low.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.