- Gold take the bids to refresh two-week tops.
- Fed-led risk-on continues ahead of US-China talks.
- Treasury yields soar, S&P 500 Futures tease record top.
Gold stays on the front foot around $1,753, currently up 0.41% intraday, during early Thursday. In doing so, the yellow metal stretches the previous day’s upside momentum as Asia reacts to Fed’s dovish performance while vaccine jitters also have some positives. On the contrary, the Sino-American tussle and geopolitical tension surrounding North Korea and Iran test the bulls but have mostly been ignored off-late.
Fed’s no immediate rate hike signals the continuation of easy money, at least until 2024, which in turn dragged the US dollar index (DXY) down the previous day. The moves also helped commodities and Antipodeans even as some of the Fed policymakers feel uncomfortable with the current dot-plot.
Elsewhere, China lacks enthusiasm in its first virtual meeting with US President Joe Biden as the US diplomats have already signaled to stay firm and frank on their demands before thinking to renews ties with Beijing. Earlier in Asia, the dragon nation indicated to propose reversing the Trump-era measures during today’s key call.
Other than the Fed and Sino-American headlines, vaccine news also entertains traders off-late. In the latest updates concerning AstraZeneca, it was known that the drugmaker is up for boosting supplies and there are many countries outside the European Union (EU) that back usage of the British-Swedish covid vaccine.
It’s worth mentioning that North Korea’s threat to the US, Japan’s increase of taxes on US beef imports and Iran’s escalating nuclear drive are additional geopolitical measures that play background music.
Against this backdrop, S&P 500 Futures flirt with the record top near 3,980 marked earlier in the week, currently up 0.30%, whereas the US 10-year Treasury yield stay firm near the 13-month top marked the previous day.
Looking forward, updates from the virtual meeting between Washington and Beijing will be the key while monetary policy meeting of the Bank of England (BOE) and market consolidation could offer extra directive to the commodity prices.
Technical analysis
A clear break above the 1.5-month-old descending trend line, at $1,747 now, eyes November 2020 lows near $1,765.
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