Gold Price Analysis: XAU/USD stays pressured below $1,850 amid risk-on mood
- Gold prices begin the week on the back foot with an upside cap of $1,841.65.
- One more week for Brexit talks, the US nearness to the stimulus and vaccination favor the risks.
- S&P 500 Futures gain half a percent, stocks in Australia, New Zealand are mildly bid.
- A light calendar keeps gold traders at the mercy of risk news.
Gold drops to $1,837.50, down 0.12% intraday, during Monday’s Asian trading. In doing so, the yellow metal keeps the downside momentum portrayed at the week’s start while following the risk-positive headlines. However, bears are also cautious amid the coronavirus (COVID-19) woes and a lack of clarity over the key issues.
Following the US Food and Drug Administration’s (FDA) official authorization to the Pfizer-BioNTech covid vaccine for emergency use, the New York Times came out with the news suggesting that the White House staff members will be among the first to be vaccinated. The news becomes important as local lockdown in the UK and the US are regaining momentum while Germany extended national activity restrictions amid the latest increase in virus infection and death toll.
Also on the risk-positive side are Brexit updates indicating that the European Commission (EC) President Ursula von der Leyen and UK PM Boris Johnson agreed to stretch Brexit talks for one more week. The policymakers conveyed during the last week that they’re “far apart” on Brexit.
Additionally, updates from US Deputy Chief of Staff Drew Hammill and CNN’s Manu Raju also indicate that the American Congress members are actively working to provide the much-awaited COVID-19 stimulus ahead of this Friday’s deadline.
Against this backdrop, S&P 500 Futures mark 0.50% gains while stocks in Pacific are up around 20% by press time.
Looking forward, a lack of major data/events will direct gold traders towards the risk events for fresh impulse.
Technical analysis
A downside break of 10-day SMA, currently near $1,842, directs gold prices towards the late-November highs around $1,818/17 before challenging the $1,800 threshold and the previous month’s low of $1,764.60.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
