Gold Prices in a Tug Of War, As Gold Traders, Seem To Prefer Staying Off

The U.S dollar index at the time this report was drafted was up 0.40% making the yellow metal more expensive for holders of other currencies (Euro, Swedish Krona, British pound sterling, Japanese yen, Swiss Franc).

Although, traders are aware on the recent increase in COVID-19 caseloads as data obtained from American-based Johns Hopkins University revealed COVID-19 caseload surpassed 27 million, with the death toll hitting pass 882,000, helped stabilized the yellow metal in the near time, as gold bears were unable to breach the $1925 critical support level.

Also increased geopolitical tensions between the U.S and China strengthened the bulls resolve, as recent reports showed President Trump’s administration might impose sanctions on more Chinese technology firms, as such move could escalate the prevailing fragile economic climate.

On the flip side, the past few trading session, as shown in Gold prices volatile and directionless as gold traders seem to prefer staying on the sidelines with the U.S dollar gaining higher and global investors rush to riskier assets like global equities, as left the yellow metal arbitrarily ranging.

Gold traders momentarily reduce their long bets in the last few weeks, as it now feels the yellow metal is falling out of favor, and might now be impossible for gold prices breaching its record highs again.

In addition, gold traders need to be wary of the bond supply coming to the market this week which can pressure rates higher and add more selling pressure to the precious metal. With the U.S Federal Reserve Bank now in a period of oblivion ahead of next Wednesday’s meeting coupled with Friday’s US Consumer Price Index numbers, it highly likely high volatility of gold prices will come to play.