Gold Price Analysis: XAU/USD bounces-off weekly lows near $1855 amid sell-off in Treasury yields
- Gold off lows, remains heavy as US dollar gains on risk-aversion.
- Rising covid cases and new shutdowns globally weigh on market mood.
- Vaccine optimism ignored as focus remains on covid updates.
Gold’s (XAU/USD) attempts a bounce from weekly lows near $1855, as the bulls recapture the $1860 mark despite the risk-aversion fuelled by the relentless rise in the coronavirus cases on both sides of the Atlantic.
Markets appear to take profits on their short positions after the price once again held onto the critical $1850 support. Further, the yieldless gold derives support from the sell-off in the US Treasury yields amid a lack of demand for riskier assets.
However, gold’s recovery attempts seem shallow, as the haven demand for the US dollar remains in vogue amid the reignition of the global economic concerns. Spiking virus cases and fresh lockdowns announced in the US, Australia and Europe threaten the prospects of an economic recovery, which weigh on the vaccine enthusiasm.
After Pfizer and Moderna, AstraZeneca announced promising results from its covid vaccine trial, adding that the final results from the phase 3 trial is expected in weeks.
Attention now turns towards the US Philly Fed Manufacturing and weekly Jobless Claims data for fresh hints on the economy. The latest covid stats from the US will be also closely eyed.
Gold Technical levels
Immediate resistance awaits at the $1874 daily high, above which the bulls will gear up for a test of the critical $1891 barrier. To the downside, October low at $1860 could be retested, below which is the next cushion is aligned at $1850/49, the September month low and November 9 low.
Gold: Additional levels
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
