Gold rallies to session tops, around $1285 level amid reviving safe-haven demand

Haresh Menghani FXStreet

• Fears of a further escalation in the US-China trade tensions underpin safe-haven demand.
• The ongoing slump in the US bond yields remained supportive of the positive momentum.
• Bullish traders seemed rather unaffected by a mildly positive tone surrounding the USD.

Gold caught some fresh bids on Wednesday and recovered a major part of the overnight sharp pullback amid reviving safe-haven demand.

The safe-haven commodity failed to benefit from reports of a further escalation in the US-China trade tensions and dropped sharply on Tuesday, weighed down by a modest pickup in the US Dollar demand. However, a sharp intraday slide in the US equity markets extended some support and helped stall the downfall.

The precious metal built on the overnight bounce and now seemed to take cues from the ongoing slump in the US Treasury bond yields. In fact, yields on the benchmark 10-year US government bond fell further below the 2.25% - the lowest since September 2017, and underpinned demand for the non-yielding yellow metal.

Bullish traders seemed rather unaffected by a mildly positive tone surrounding the greenback, which tends to dent demand for the dollar-denominated commodity, though are likely to wait for a convincing break through the $1287-88 supply zone before positioning aggressively for any further near-term appreciating move.

There isn't any major market moving US economic data due for release on Wednesday and hence, the broader market risk sentiment, driven by fresh trade-related headlines, might continue to act as a key determinant of the commodity's momentum.

Technical levels to watch

XAU/USD

Overview
Today last price	1285.14
Today Daily Change	5.64
Today Daily Change %	0.44
Today daily open	1279.5

Trends
Daily SMA20	1282.95
Daily SMA50	1288.68
Daily SMA100	1296.51
Daily SMA200	1260.74

Levels
Previous Daily High	1292.8
Previous Daily Low	1276.23
Previous Weekly High	1297.8
Previous Weekly Low	1269.1
Previous Monthly High	1310.7
Previous Monthly Low	1265.6
Daily Fibonacci 38.2%	1282.56
Daily Fibonacci 61.8%	1286.47
Daily Pivot Point S1	1272.89
Daily Pivot Point S2	1266.28
Daily Pivot Point S3	1256.32
Daily Pivot Point R1	1289.46
Daily Pivot Point R2	1299.41
Daily Pivot Point R3	1306.02

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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