Today in the European trading session, the yellow metal prices succeeded in stopping its early-day losing streak and took some modest bids in the last hour near above the 1,915 level. However, the overall bullish tone around the bullion prices could be associated with the broadly weaker U.S. dollar as the gold price is inversely related to the U.S. dollar price. The U.S. dollar was being pressured by the upbeat market mood, as well as, the hopes for the latest U.S. stimulus measures also kept the U.S. dollar under pressure.
Apart from this, the U.S. political uncertainty ahead of the presidential election on November 3 kept challenging the market risk-on tone and helped the safe-haven metal. On the contrary, the overnight optimism that the U.S. President Donald Trump discharged from the hospital becomes the key factor that kept the lid on any additional gains in the yellow metal prices. The yellow metal prices are currently trading at 1,916.65 and consolidating in the range between 1,906.76 – 1,918.09.
However, the market trading sentiment kept struggling to extend its previous session positive bias and remained supportive by the latest optimism over the U.S. President Donald Trump’s return to the White House following a 3-day hospital stay due to coronavirus infection. Apart from this, the expectations of further stimulus from America also positively impacted the market trading sentiment. These hopes could be considered as one of the key factors that undermining safe-haven assets, including gold.
Across the Pond, the tensions between China and the U.S. keep gaining market attention and challenged the market risk-on tone. The renewed US-China tussle at the US-China front keeps challenging the market risk mood, adding further pessimism around the currency pair. As per the latest report, the Dragon Nation continues criticizing the U.S. ban on TikTok and WeChat at the World Trade Organization (WTO). These conflicting headlines might help the safe-haven metal prices by increasing the safe-haven demand in the market.
Elsewhere, the upbeat US ISM Services PMI data failed to leave any major impact on the market as the U.S. dollar hit a fresh low. At the USD front, the broad-based U.S. dollar remained depressed as the investors continue to sell U.S. dollars in the wake of the low safe-haven demand in the market. Looking forward, the market traders keeping their eyes on the Fed Chair Jerome Powell’s scheduled speech. In the meantime, the updates surrounding the fresh Sino-US tussle, as well as the coronavirus (COVID-19), could not lose their importance.
Daily Support and Resistance
Pivot Point 1902.24
The yellow metal gold continues to trade bullish at 1,911 levels. The formation of candles beyond the 1,908 mark is likely to support the gold today. On the 4 hour chart, candles closing below 1,908 mark are expected to drive more selling till 1,900 levels, while the bullish breakout of 1,917 resistance may ascertain the next trend in the market. Although we opened a sell trade during the European session in gold, we soon realized that it’s not worth holding gold as it’s forming a bullish setup. The bullish bias remains solid above 1,908. Good luck!