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  • Gold prices jump to near $5.00 while keeping late Friday’s pullback from $1,852.
  • Stimulus hopes favor S&P 500 Futures but virus woes challenge optimists.
  • Uncertainty surrounding the US Presidential Election, Brexit play their roles amid a light calendar.

Gold rises to $1,865, intraday high $1,866.14, during the early Asian session on Monday. The bullion recently picked up bids as the market sentiment improved over the hopes of the American stimulus to combat the coronavirus (COVID-19). Though, fears of strict lockdown conditions hampering the global economic growth seem to probe the bulls. Additionally, catalysts likely allegations on US President Donald Trump and Brexit uncertainty are an extra burden on the market’s mood.

Mixed clues everywhere…

Global market players are in a dilemma as the key risk catalysts are flashing mixed signals off-late. While the surge in the COVID-19 cases, coupled with the likely return of national lockdown conditions in major economies, challenges the market mood, hopes of the virus vaccine tame the pessimism.

Elsewhere, the Confederation of British Industry (CBI) head Carolyn Fairbairn is optimistic about the Brexit trade deal ahead of the ninth round of talks starting from Tuesday. The Irish leader, Taoiseach Micheál Martin, on the other hand, said during the weekend that Britain headed for no-deal Brexit.

Furthermore, US House Speaker Nancy Pelosi believes, as per the CNBC, that the COVID-19 aid package deal is possible considering the Democratic preparation for a new package. It should also be noted that the New York Times alleged American President Donald Trump over income tax returns of $750 for 2016 and 2017. However, the Democratic leader termed it as “fake news” while showing strong belief to have tremendous victory in the election.

Amid all these catalysts, S&P 500 Futures track Friday’s upbeat performance of Wall Street while rising 0.36% to 3,298 by the press time. The risk barometer seems to await clearer signals to extend the latest recovery.

In doing so, the economic calendar may prove to be less helpful, containing no major data/events, while headlines concerning Brexit, pandemic and US Presidential Election may offer important clues.

Technical analysis

While 100-day SMA, at $1,847 now, offers immediate strong support to gold prices, buyers may wait for an upside break of the September 21 low near $1,882 before taking any fresh entries.