Gold to extend its slide with a daily close below $1,850

Gold closed the second straight week in the negative territory around $1,870 as coronavirus vaccine optimism continues to weigh on the yellow metal. Sellers look to remain in control if XAU/USD fails to climb beyond $1,900, FXStreet’s Eren Sengezer reports.

Key quotes

“Investors will keep a close eye on fresh headlines surrounding coronavirus vaccines. Citing European Commission President Ursula von der Leyen, Bloomberg reported on Friday that the European Medicines Agency and the US Food and Drug Administration remain in close contact on the evaluation of the vaccines and work toward a synchronized approval. Von der Leyen further noted that a conditional marketing authorization could arrive as early as the second half of December. Any positive developments on that front could cause gold to continue to lose interest.”

“On the downside, significant support is located at $1,850 (Fibonacci 61.8% retracement of June-August uptrend). A decisive move below $1,850 could attract more sellers and drag the pair toward $1,820 (former resistance). The 200-day SMA at $1,800 is the next line of defence but it would be a major surprise if the price were to decline there this year given the thin trading volumes.”

“Resistances could be seen at $1,890 (20-day SMA), $1,900 (psychological level/Fibonacci 50% retracement) and $1,910 (100-day SMA).”