- Gold is struggling to pick up a bid despite risk-off tone in Asia.
- The strength in the US Dollar is likely keeping the safe haven metal under pressure.
Gold is again having a tough time scoring gains despite signs of risk aversion in the financial markets.
As of writing, the yellow metal is trading largely unchanged on the day at $1,273 per Oz, despite the 0.24% drop in the futures on the S&P 500.
Asian stocks are also reporting modest declines. For instance, Japan’s Nikkei and Australia’s S&P/ASX 200 are down 0.7% and 0.2%, respectively.
The metal’s failure to rise on risk aversion is nothing new. After all, prices dropped in the preceding seven days despite the escalating US-China trade tensions.
Notably, gold faded a minor spike to $1,277 on Wednesday to end the day with moderate losses at $1,272, forming an inverted bearish hammer-like candle on the daily chart even though the 10-year treasury yield fell by more than five basis points to 2.38%. The metal’s decline could be associated with the drop in the Fed rate cut odds following the release of the Fed minutes.
Also, it appears the yellow metal is mainly focused on the Dollar Index, which has risen from 97.00 to 98.00 over the last nine days. At press time, the index is reporting marginal gains near 98.10.
Looking forward, gold may find takers if the US dollar comes under pressure. That, however, looks unlikely, as long as the trade tensions persist. The recent action indicates the US Dollar is being considered a safe haven against most majors except JPY.
Pivot levels
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