- Gold extended its sideways consolidative price action through the early European session.
- A goodish pickup in the USD demand capped gains for the dollar-denominated commodity.
- Concerns about the continuous rise in COVID-19 cases might help limit any meaningful slide.
Gold was seen oscillating in a range below the $1785 level and remains well within the striking distance of multi-year tops set last Wednesday.
A combination of diverging forces failed to assist the commodity to build on its gains recorded over the past two trading sessions, rather led to a subdued/range-bound trading action on Tuesday. Growing worries about the ever-increasing COVID-19 cases globally extended some support to the safe-haven precious metal during the Asian session.
Investors remain concerned that the second wave of coronavirus infections could trigger renewed lockdown measures to contain the spread and that the current economic recovery may prove to be short-lived. The market worries led to a modest pullback in the equity markets and drove investors back towards traditional safe-haven assets.
Meanwhile, the supporting factor, to a larger extent, was negated by a goodish pickup in the US dollar demand, which tends to undermine the dollar-denominated commodity. Monday's upbeat US ISM Non-Manufacturing PMI print indicated that the economy has already started to recover and helped ease the recent bearish pressure surrounding the greenback.
It will now be interesting to see if the yellow metal is able to attract any follow-through buying or continues with its consolidative moves. In the absence of any major market-moving economic releases, the USD price dynamics and developments surrounding the coronavirus saga will play a key role in influencing the commodity's movement on Tuesday.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stabilizes near 1.0800 as trading action turns subdued
EUR/USD holds steady near 1.0800 on Thursday and remains on track to end the day in negative territory following upbeat macroeconomic data releases from the US. The action in financial markets turn subdued as trading volumes thin out heading into Easter holiday.
GBP/USD extends sideways grind above 1.2600
GBP/USD fluctuates in a narrow channel above 1.2600 on Thursday. The better-than-expected Initial Jobless Claims data from the US and the upward revision to the Q4 GDP growth help the USD stay resilient against its rivals and limits the pair's upside.
Gold pulls away from daily highs, holds above $2,200
Gold retreats from daily highs but holds comfortably above $2,200 in the American session on Thursday. The benchmark 10-year US Treasury bond yield stays near 4.2% after upbeat US data and makes it difficult for XAU/USD to gather further bullish momentum.
XRP price falls to $0.60 support as Ripple ruling doesn’t help Coinbase lawsuit against SEC
XRP programmatic sales ruling by Judge Torres was completely rejected by another US Court that ruled in favor of the SEC in a lawsuit against Coinbase.
Portfolio rebalancing and reflation trades emerge into Q2
Yesterday’s price action pointed at a possible end-of-quarter portfolio rebalancing as the session saw the laggards of the quarter like Apple and Tesla gain, and the stars like Microsoft and Nvidia retreat.