- Gold prices seesaw in a choppy range between $1,875 and $1,885 following its corrective recovery from $1,855.
- US Congress votes on the much-awaited aid package, vaccine manufacturers, regulatory bodies tame fears from the new strain of covid.
- Brexit talks also inch closer to solving the key hurdle but nothing is confirmed yet.
Gold prices waver around $1,880 during Tuesday’s Asian session. In doing so, the yellow metal recovers the previous day’s losses while keeping bounce off $1,855 in the $10 range. Although optimism concerning the US coronavirus (COVID-19) stimulus and the new variant of the virus favor the bulls, uncertainty over Brexit and a light calendar keep the gold bears hopeful.
Risks dwindle amid light trading…
With the mixed signals concerning Brexit and no major updates on the fresh version of covid, not to forget cautious sentiment ahead of the formal announcement on the US COVID-19 aid package, trading sentiment stays directionless, mostly downbeat, off-late.
US Congress members are currently voting on the $900 billion aid package, as well as the $1.4 trillion omnibus government spending bill, with most policymakers favoring the smooth passage. Elsewhere, Moderna follows BioNtech’s optimism towards taming the recently found version of the covid in the UK. However, fears of a national lockdown in Britain, as well as nearly 40 countries’ ban on the UK travels, probe the risk-on mood.
Brexit talks are finally reaching towards the solution of fisheries with the early signals from the MNI saying, “The UK has moved a long way towards EU demands on fisheries, improving the prospects of a trade deal, although Brussels is expected to hold out for further concessions, according to sources in touch with both sides of the negotiations.”
Market mood worsened at the week’s start amid fears of the virus resurgence and no-deal Brexit but comments from the European Medicines Agency suggesting that there’s no evidence that the just developed vaccines won’t work with the new coronavirus variant tamed the bears. Also on the positive side was UK PM Boris Johnson’s readiness for the eleventh-hour effort for Brexit.
Against this backdrop, S&P 500 Futures wobble around 3,700 whereas Japan’s Nikkei drops 0.30% by press time.
Moving on, gold traders will keep their eyes on the US stimulus headlines for immediate direction while any more negatives from the UK, concerning the virus or Brexit, can recall the bears.
Technical analysis
Gold traders struggle for a clear direction between 50-day and 100-day SMA, respectively around $1,870 and $1,902. Also acting as the key upside barrier is the falling trend line from August 07, at $1,915 now.
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