- Gold prices recede from $1,818.17, the highest since September 2011 flashed Wednesday.
- Record US coronavirus cases join Sino-American tension to weigh on the greenback and favor the commodity bulls.
- Global efforts to tame the pandemic’s economic side effects fail to produce any meaningful results.
- China inflation data, US Jobless Claims to offer immediate direction.
Gold prices take rounds to $1,810 amid the initial Asian session on Thursday. The yellow metal crossed the $1,800 threshold while refreshing the multi-year to $1,818.17 the previous day. However, a lack of major directives afterward kept the bulls waiting.
Read: Forex Today: Mixed trade in absence of market-moving news, DXY on the backfoot
Nothing is safer than gold…
Amid all the noise surrounding the record surge in the US coronavirus (COVID-19) cases and the Sino-American tension, the precious metal buyers chose to pick the greenback weakness to refresh the multi-year high on Wednesday. Also adding to the bull’s strength were doubts over further equity gains and volatile performances of other investment avenues.
New cases from the US crossed a 3.0 million mark with a rise of over 60,000. Further, the latest update from the Texas Health Department suggests new cases rise by 9,979 to 220,564 on Wednesday while marking the biggest daily increase since pandemic started. On the contrary, cases in Tokyo slipped to 75, the first below-100 reading in seven days, while Victoria also marked a receding figure of 134 versus 191 on the previous day. Furthermore, Beijing is keeping its zero virus case level while also inching closer to a third trial of the vaccine.
Elsewhere, the US diplomats continue to attack China with harder policies. Recently, US Secretary of State Mike Pompeo raised bars for the diplomats from Beijing to get American visas. The Trump administration official is also in talks with others, excluding US President Donald Trump, to undermine the Hong Kong dollar peg. Though, the dragon nation defies everything and opens a new security office in Hong Kong.
It should also be noted that investors have recently started doubting further rallies in the global stocks, not only Wall Street. The moves could be seen in the rush towards cryptos and gold as well as the surge in Bank of Japan’s (BOJ) surge in deposits to the fresh landmark.
Amid all these plays, US equities marked gains below 1.0% whereas the US 10-year Treasury yields rose to 0.66% by the end of Wednesday. Additionally, S&P 500 Futures add 0.13% to 3,167 by the press time.
While the virus updates and news concerning China could keep the driver’s seat, the June month Consumer Price Index (CPI) and Producer Price Index (PPI) from the dragon nation will offer immediate clues ahead of the US weekly jobless. With the anticipated recovery in China’s inflation data, in a contrast to softness in American numbers, the bullion buyers may find hardships in extending the latest rally.
Technical analysis
Unless slipping back below the year 2012 top near $1,795, the bullion is less likely to part ways from the run-up to the record high above $1,900.
Read: Gold Price Analysis: Will it be a smooth journey to the all time high?
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