- Gold prices extend recoveries from $2,049.44 to flash $2,075.32.
- No August vacation for US Senators as much-awaited stimulus stays unclear.
- Virus woes, US dollar weakness keep the bulls happy as well.
- US employment data may extend greenback’s drop unless the Congress marks any surprises.
Gold bulls are unstoppable as they refresh all-time high to $2,075.32, currently around $2,070 amid the initial hour of Friday’s Asian trading. The bullion continues to please buyers as uncertainty surrounding the US stimulus joins the coronavirus (COVID-19) woes and US dollar declines.
The only direction is north…
Be it the recently announced adjournment of the US Senate or the broad downside of the greenback, not to forget about the worsening of COVID-19, global markets players are all rushing to gold for risk-safety. It should also be noted that the major central banks’ push towards easy money and dovish statements add charm to the precious metal’s run-up.
The Senate Republican Leader Mitch McConnell calls off the stimulus negotiation for the week to resume on Monday at 03:00 PM EDT. The same will require Senators to keep jostling over the much-awaited aid program even in August when they generally enjoy the vacation.
Elsewhere, Australia’s Treasury announced additional support to the government’s JobKeeper program whereas the BOE and RBA have already conveyed fears of the pandemic during the week.
Amid all these catalysts, Wall Street cheers the US dollar index (DXY) trading near two-year low whereas Treasury yields are around five-month trough surrounding 0.54%.
Given the cancellation of US stimulus talks, traders may now turn to the RBA Monetary Policy Statement (MPS) and China’s Trade numbers for immediate direction. However, major attention will be given to the US July month employment data considering the recently downbeat signals for the early indicators.
Read: Nonfarm Payrolls Preview: Hints point to an awful July
Furthermore, US President Donald Trump has already shown the intention to use executive order to extend the unemployment claims benefits. The same could keep the market players worried about the surprises.
Technical analysis
The bulls are all set to challenge $2,100 round-figure unless slipping back below $2,000 round-figures. Further observation suggests that 61.8% Fibonacci Expansion of 2001-11 run-up near $2,077 as immediate resistance with the previous record high of $1,921 acting as an additional downside filter.
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