Gold holds above $1,800 level as virus casts long shadow
· Gold held steady above the key $1,800/oz level on Thursday, as worries over mounting COVID-19 cases offset hopes of a swift global economic recovery.
· Spot gold was little changed at $1,808.44 per ounce by 0243 GMT, after rising to its highest level since September 2011 at $1,817.71 on Wednesday. U.S. gold futures were flat at $1,819.80.
· Traders are seen a little exhausted after the metal cleared the $1,800 level, “but no one seems eager to abandon this trade yet”, said Edward Moya, senior market analyst at broker OANDA.
“Gold is looking very bullish both in the short- and long-term... It has enough catalysts to take it to record territory before the end of the year,” said Moya.
· Global coronavirus cases reached more than 12 million on Wednesday, with more than half a million dead.
· Keeping alive worries over the economic fallout from the pandemic, U.S. Federal Reserve officials on Wednesday suggested the recovery in the world’s largest economy may be stalling.
· Meanwhile, Britain’s finance minister promised an additional $38 billion to head off an unemployment crisis.
· Stimulus tends to boost gold, which is viewed as a hedge against inflation and currency debasement.
· Providing further support to gold, the dollar traded near multi-week lows.
· Asian equities ground higher as investors tried to look past gathering Sino-U.S. tension and renewed lockdowns to upcoming company earnings, hoping that global stimulus efforts will yield upbeat outlooks.
· Boosting recovery bets, Japan’s core machinery orders rose 1.7% in May from the previous month, versus a 5.4% drop forecast.
· Gold Price News and Forecast: XAU/USD optimists await more clues to refresh multi-year top above $1,800
Gold prices take rounds to $1,810 amid the initial Asian session on Thursday. The yellow metal crossed the $1,800 threshold while refreshing the multi-year to $1,818.17 the previous day. However, a lack of major directives afterward kept the bulls waiting.
Amid all the noise surrounding the record surge in the US coronavirus (COVID-19) cases and the Sino-American tension, the precious metal buyers chose to pick the greenback weakness to refresh the multi-year high on Wednesday. Also adding to the bull’s strength were doubts over further equity gains and volatile performances of other investment avenues.
On a break above the latter, the next resistance is seen at $1806, the pivot point one-week R2. Alternatively, the immediate downside could be cushioned at the pivot point one-week R2 near $1791.50.
· Among other metals, palladium rose 0.5% to $1,926.33 per ounce, while platinum declined 0.3% to $840.95 and silver fell 0.6% to $18.66.
Reference: CNBC, FXStreet
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