Gold Price Analysis: XAU/USD builds on Friday’s rebound to test $1780
- XAU bulls find support from rising coronavirus cases globally.
- Upbeat market mood fails to sustain despite China’s vaccine news.
- Eyes on virus updates and Fed Chair Powell’s testimony in the week ahead.
Gold (XAU/USD) is looking to build onto Friday’s sharp $25 reversal on Monday, as the bulls have regained control in early European trading, following a brief phase of upside consolidation seen in Asia.
At the time of writing, Gold trades better bid around 1774, making headways towards the seven-year highs of 1779.41 reached last Wednesday. The spot saw a weekly closing above 1770 levels for the first time in nearly eight years.
Growing concerns over the second-wave of coronavirus globally, especially given the consistent rise in new infections in the US states, Australia and China, continue to weigh on the global stocks while keeping the safe-haven bids intact for gold.
In the Asian trades, the bulls took a breather amid a bounce in the US equity futures on encouraging news from China over the weekend. Sinopharm Group announced that in partnership with the Chinese Centre for Disease Control and Prevention, they are advancing on clinical trials to develop a COVID-19 vaccine. The vaccine is approved by the country’s military.
In the day ahead, the incoming virus statistics from across the globe and Brexit talks anxiety will likely keep the traditional safe-haven underpinned, with a test of 1780 levels on the cards. Also, the US Pending Home Sales and Fed’s Williams speech will be watched out today for fresh dollar trades. Fed President Jerome Powell’s testimony due later this week will hold the key for the next direction in gold.
Gold: Technical levels to consider
Bulls extend their struggle to takeout the 1780 barrier. A sustained breakthrough above the latter could open the doors towards the key 1800 level. To the downside, the next support is seen at 1767.76 (daily low), below which Thursday’s high of 1754.32 could be eyed.
Gold additional levels