- XAU/USD sidelined heading into the European session.
- Downside limited by dollar weakness, coronavirus concerns.
- Focus remains on the USD dynamics and US-China updates.
Gold (XAU/USD) is ranging within a $10 range around $1975 so far this Tuesday’s trading, as the bulls and bears fight for control amid a lack of fresh catalysts.
Although, the bulls remain hopeful amid a broadly weaker US dollar, as the US 10-year inflation-adjusted Treasury yields continue to dive deeper into the negative territory. Meanwhile, renewed US-China spat, this time over the Tik-Tok issue, combined with persisting coronavirus concerns keep the haven bids for gold intact.
The upbeat sentiment on the global stocks, however, limits the upside attempts in the spot. The traders cheer the above-forecasts US ISM Manufacturing PMI data, although the employment part of the index still remains a concern, which has cautioned the bulls ahead of the US Non-Farm Payrolls report due this Friday.
The sideways movement in the yellow metals could be also associated with a Doji candle formed on the daily chart on Monday, which likely suggests a lack of clear directional bias. Markets now await the US Factory Orders data and fiscal stimulus talks for directives on the bright metal.
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Gold Technical levels
The immediate upside barrier is seen at $1980 above which the record highs of $1988.02 could be tested. To the downside, the daily low near $1971 could offer some cushion. The next support is aligned at $1960 (previous day low).