- Gold picks up bids to reverse the previous day’s pullback from one-week top.
- Powell tried to placate reflation fears, vaccine optimism prevails.
- US stimulus gridlock, light calendar challenge the mood.
- Powell 2.0, risk news will be the key to watch.
Gold keeps $1,800, currently around $1,805, while struggling to defy the previous day’s pullback from a one-week top during the initial Asian session on Wednesday. The yellow metal snapped the two-day winning streak amid the US dollar’s corrective pullback. However, the greenback’s failures to hold the recovery moves seem to favor the gold buyers.
Powell couldn’t placate bond bears…
Despite showing readiness to extend the bond purchase and flashing ‘enough’ advance signals before rolling back the easy money, Fed Chair Jerome Powell couldn’t tame the yields. The reason could be traced from the statements suggesting further expected upside in the inflation figures.
On the other hand, AstraZeneca’s latest comments suggest that the first real-world study of the covid-19 vaccine demonstrates a 94% reduction in hospitalizations. Elsewhere, the US policymakers are trying to progress on the much-awaited covid stimulus, but fail off-late, whereas the political tussle among the US-China and Washington-Tehran continues.
It should be noted that the surge in the Treasury yields takes money off the riskier assets, like equity and commodity off-late, which in turn challenge the gold buyers in case of the rising bond coupons.
Against this backdrop, S&P 500 Futures drop 0.20% after Wall Street benchmarks closed mixed for Tuesday.
Looking forward, the yellow metal traders will keep their eyes on the second Testimony of Fed’s Powell for clarification while updates on US coronavirus relief package and vaccines should offer extra catalysts to watch.
A downward sloping trend line from January 06, currently around $1,813, precedes a 21-day SMA level of $1,818, to challenge short-term gold buyers. Though, fresh declines need validation from $1,785 to convince the yellow metal bears.
Additional important levels
|Today last price||1805.96|
|Today Daily Change||-2.32|
|Today Daily Change %||-0.13%|
|Today daily open||1808.28|
|Previous Daily High||1812.7|
|Previous Daily Low||1780.75|
|Previous Weekly High||1827.11|
|Previous Weekly Low||1760.72|
|Previous Monthly High||1959.42|
|Previous Monthly Low||1802.8|
|Daily Fibonacci 38.2%||1800.5|
|Daily Fibonacci 61.8%||1792.95|
|Daily Pivot Point S1||1788.45|
|Daily Pivot Point S2||1768.63|
|Daily Pivot Point S3||1756.5|
|Daily Pivot Point R1||1820.4|
|Daily Pivot Point R2||1832.53|
|Daily Pivot Point R3||1852.35|
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