Gold Price News and Forecast: XAU/USD is up more than 2% on Monday

FXStreet Team FXStreet

Gold price rockets ahead of Georgia senate election

Gold price soared to the highest level in two months as traders looked ahead to the upcoming run-off election in Georgia. This senatorial election will determine who will lead the senate in the first part of Joe Biden’s administration. If the Republicans win one of the two seats, it will mean that Senator Mitch McConnel will be the Senate majority leader. He will then be able to block most of Joe Biden’s agenda, including higher taxes, more regulations, and judicial appointments. On the other hand, if Democrats win, it will lead to the possibility of more stimulus, regulations, and higher taxes.

Gold Price Analysis: XAU/USD extends daily rally beyond $1,940

The XAU/USD pair opened sharply higher on the first day of 2021 and preserved its bullish momentum with the technical breakout attracting more buyers. As of writing, the pair was up 2.45% on a daily basis at $1,940.

EUR/USD trims gains, reclaims 1.1600 and beyond

Following an earlier drop to yearly lows around 1.1530, EUR/USD now manages to recoup part of the ground lost and reclaim the area above 1.1600 the figure in the latter part of the NA session on Tuesday. Meanwhile, the pair’s marked retracement comes in response to the unabate march norht in the US Dollar, always propped up by the intense flight-to-safety environment amid the deteriorating geopolitical landscape in the Middle East.

GBP/USD attacks 1.3300, refreshing three-month lows

GBP/USD is deep in the red near 1.3300, accelerating its downside to renew three-month lows in European trading on Tuesday. The ongoing escalation in the Iran war, combined with rising Oil prices, weighs negatively on the higher-yielding Pound Sterling as the US Dollar capitalizes on increased haven demand.

Gold bounces off lows, back above $5,100

Gold remains on the defensive, eroding part of the recent multi-day advance and managing to trade back above the $5,100 mark per troy ounce on Tuesday. The precious metal initially dropped just below the critical $5,000 threshold on the back of the persistent strength of the Greenback, higher US Treasury yields across the curve and investors' repricing of Fed rate cuts.