- Gold regained some positive traction for the second straight session on Thursday.
- Dismal incoming economic data underpinned the commodity’s safe-haven demand.
- Sustained USD buying seemed to be the only factor capping the upside for the metal.
Gold held on to its positive tone through the early North-American session and was last seen trading near the top end of its daily trading range, around the $1730 region.
Following an early dip to the $1707 region, the precious metal regained traction for the second straight session on Thursday and the momentum was fueled by nervousness over an imminent global recession.
The market concerns about the economic fallout from the coronavirus pandemic were further fueled by Thursday’s dismal PMI releases from the Eurozone and the UK, which weighed on investors’ sentiment.
A slight deterioration in the global risk sentiment was evident from a modest pullback in the equity markets, which turned out to be a key factor that benefitted the commodity’s perceived safe-haven status.
Meanwhile, the intraday uptick seemed rather unaffected by sustained US dollar buying interest, albeit might hold investors from placing any aggressive bullish bets around the dollar-denominated commodity.
The USD remained well supported by its status as the global reserve currency after the latest US macro data further illustrated the extent of economic damage caused by the coronavirus-induced lockdowns.
According to the latest report, 4.43 million individuals filed for unemployment insurance for the first time last week, down from 5.237 million previous and around 50% from the peak at the start of April.
Given that investors were already anticipating another disastrous reading for the Initial Weekly Jobless Claims, the data did little to impress traders or provide any meaningful impetus to the commodity.
Technical levels to watch
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