- Gold trims losses from a two week low of $1,873.
- US President Trump’s tweets offer small reliefs after stopping the aid package the previous day.
- Chatters over European tariffs on China, Taiwan and Indonesia join Brexit, virus woes to tame the risks.
- Updates from US, European central banks will decorate the calendar, risk catalysts keep the driver’s seat.
Gold prices refresh the intraday high to $1,887.32, currently up 0.42% around $1,885.70, ahead of Wednesday’s European session. The yellow metal recently picked bids after US President Donald Trump showed readiness to offer helps to airlines and small businesses. However, rumors about the European Union’s (EU) steel tariff over the Asian countries seem to question the risk-on mood.
Having earlier rejected over $2.0 trillion stimulus, US President Trump recently tweeted a proposal of $160 billion of collective help. The news supported S&P 500 Futures to reverse the previous losses.
However, stocks in Asia still trade mixed amid unconfirmed talks over the EU’s steel tariffs of China, Taiwan and Indonesia. Further, the coronavirus (COVID-19) woes in the bloc and the UK join the Brexit uncertainty to weigh on the trading sentiment.
It should additionally be noted that the US dollar index (DXY) slips from the fresh weekly high of 93.90 to 93.81 as we write. The greenback’s gauge versus the major currencies marked the biggest gains in two weeks the previous day. It’s worth mentioning that the inverse correlation between the USD and gold is likely behind the metal’s latest moves.
Moving on, updates from Trump, be it relating to COVID-19 or stimulus, will occupy the key place while searching for the market clues ahead of speeches from the US Fed policymakers and the ECB’s President Christine Lagarde. Also important will be the US FOMC minutes and any news relating to Brexit, pandemic, etc.
Technical analysis
A two-month-old falling trend line near $1,920 adds to the upside barriers beyond the $1,900 round-figure. Meanwhile, the September month’s low around $1,848 can lure the sellers below the intraday bottom surrounding $1,873.
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