Gold Price Analysis: XAU/USD struggles near two-month lows, around $1850 area
|- Gold remained under some selling pressure for the fourth straight session on Thursday.
- The prevalent USD buying continued weighing on the dollar-denominated commodity.
- The risk-off mood did little to lend any support or stall the ongoing bearish trajectory.
Gold remained depressed through the first half of the trading action on Thursday and was last seen hovering near two-month lows, around the $1850 region.
XAU/USD prolonged this week's bearish break through the $1900 strong horizontal support and witnessed some follow-through selling for the fourth consecutive session on Thursday. The ongoing downtrend was exclusively sponsored by strengthening US dollar, which tends to undermine demand for the dollar-denominated commodity.
The second wave of coronavirus infections raised uncertainty over the economic recovery and continued boosting the greenback's status as the global reserve currency. The USD bulls seemed rather unaffected and largely shrugged off warnings by various Fed officials about the need for further stimulus measures to sustain the recovery.
Meanwhile, the prevalent risk-off environment – as depicted by a weaker tone surrounding the equity markets – did little to revive the precious metal's safe-haven demand. Even a fall in the US Treasury bond yields failed to lend any support to the non-yielding yellow metal or stall the ongoing slide to the lowest level since July 22nd.
Market participants now look forward to the US economic docket, highlighting the release of Initial Weekly Jobless Claims and New Home Sales data. This, along with a scheduled testimony by the Fed Chair Jerome Powell and Treasury Secretary Steven Mnuchin, will influence the USD price dynamics and produce some short-term trading opportunities.
Technical levels to watch
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.