- A subdued USD price action assisted gold to gain some traction on Friday.
- The upbeat market mood kept a lid on any strong gains for the commodity.
- Investors now eye US monthly jobs report for some meaningful impetus.
Gold edged higher during the Asian session, albeit lacked any strong follow-through buying and remained below the $1800 round-figure mark.
The precious metal managed to regain some positive traction on the last trading day of the week and moved away from over two-month lows, around the $1785 region touched on Thursday. The US dollar was seen consolidating its recent strong gains to over two-month tops, which, in turn, was seen as one of the key factors that extended some support to the dollar-denominated commodity.
Apart from this, the uptick could further be attributed to some repositioning trade ahead of Friday’s release of the closely-watched US monthly jobs report – popularly known as NFP. That said, the underlying bullish sentiment in the financial markets might hold bulls from placing any aggressive bets and keep a lid on any meaningful upside for the safe-haven XAU/USD.
The global risk sentiment remained well supported by optimism over a massive US economic stimulus plan, the incoming positive US macro data and progress with coronavirus vaccinations. Meanwhile, the prospects of a larger government borrowing to fund the stimulus might continue to push the US Treasury bond yields higher and further cap gains for the non-yielding yellow metal.
Moreover, the overnight slide below the $1800 level added credence to this week’s breakthrough a short-term ascending trend-line support. Hence, any further positive move might still be seen as a selling opportunity and runs the risk of fizzling out rather quickly near the $1817-18 horizontal zone.
Technical levels to watch
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