- Gold wavers in a choppy range between $1,841 and $1,830 after bouncing off seven-week low.
- US dollar pullback, risk consolidation entertained gold buyers amid a dull day with the US markets off.
- Virus woes battle vaccine hopes, politics keep traders busy.
- Incoming Treasury Secretary Janet Yellen’s speech, President-elect Joe Biden’s formal entry into the White House be the key.
Gold eases from the top of an immediate $10 trading range while declining to $1,837 at the start of Tuesday’s Asian session. The yellow metal took a U-turn from the lowest since December 01 the previous day as the US dollar stepped back after refreshing the one-month high. However, holiday in the US markets and a light calendar elsewhere keeps the bullion prices in a tight range ahead of important events.
Markets brace for the key days…
The extended weekend in American cooled down the US dollar upside following the initial run-up to refresh the highest levels since December 21. The reason could be traced to the initial cautious sentiment ahead of the Biden government’s inauguration and the coronavirus (COVID-19) worries. However, upbeat data from China and expectations that US President-elect Joe Biden and company will easily rollout the promised $1.9 trillion covid aid package improved market sentiment afterward.
Although Biden’s optimistic plan needs Senate’s approval and that’s where his team member Janet Yellen will play a big role, her latest prepared Senate remarks for Tuesday’s speech suggest favor for the huge relief package considering record low-interest rates.
On a different page, Italy’s Prime Minister Giuseppe Conte wins the chamber of deputies' confidence vote by 321-259, as expected, but is left to win in the Senate to keep the nation’s reign. Herein, Conte will need over 321 votes to turn down the shock from former ally Matteo Renzi.
Talking about the virus, covid cases in Europe, the US and the UK ease off-late but aren’t satisfactory as the strains are spreading faster, which in turn cause fresh activity restrictions. Elsewhere, Asia and Pacific's nations are taking precautionary measures after finding a few cases of the COVID-19 variants as mass vaccinations begin.
Amid these plays, S&P 500 Futures mark mild gains while the US dollar index (DXY) prints minor losses around 90.75 by press time.
Looking forward, second-tier economics and virus updates in Asia may provide intermediate moves to the gold traders ahead of the key speeches from Yellen and Biden, not to forget monetary policy meeting by the ECB.
Technical analysis
Unless breaking a range between 200-day SMA and an upward sloping trend line from March, respectively around $1,845 and $1,823, gold prices are likely to remain sideways.
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
USD/JPY holds near 155.50 after Tokyo CPI inflation eases more than expected
USD/JPY is trading tightly just below the 156.00 handle, hugging multi-year highs as the Yen continues to deflate. The pair is trading into 30-plus year highs, and bullish momentum is targeting all-time record bids beyond 160.00, a price level the pair hasn’t reached since 1990.
AUD/USD stands firm above 0.6500 with markets bracing for Aussie PPI, US inflation
The Aussie Dollar begins Friday’s Asian session on the right foot against the Greenback after posting gains of 0.33% on Thursday. The AUD/USD advance was sponsored by a United States report showing the economy is growing below estimates while inflation picked up.
Gold soars as US economic woes and inflation fears grip investors
Gold prices advanced modestly during Thursday’s North American session, gaining more than 0.5% following the release of crucial economic data from the United States. GDP figures for the first quarter of 2024 missed estimates, increasing speculation that the US Fed could lower borrowing costs.
Ethereum could remain inside key range as Consensys sues SEC over ETH security status
Ethereum appears to have returned to its consolidating move on Thursday, canceling rally expectations. This comes after Consensys filed a lawsuit against the US SEC and insider sources informing Reuters of the unlikelihood of a spot ETH ETF approval in May.
Bank of Japan expected to keep interest rates on hold after landmark hike
The Bank of Japan is set to leave its short-term rate target unchanged in the range between 0% and 0.1% on Friday, following the conclusion of its two-day monetary policy review meeting for April. The BoJ will announce its decision on Friday at around 3:00 GMT.