Search ForexCrunch
  • Gold fails to keep bounces off $1,929.66, extends Friday’s losses.
  • S&P 500 Futures rise 0.30% but Japan’s Nikkei 225 and Australia’s ASX 200 drop.
  • US policymakers to reconvene the House Session later this week.
  • Sino-American trade review delayed, Japan’s GDP slumped the most since 1980.

Gold prices ease to $1,939.80, down 0.24% on a day, during Monday’s Asian session. In doing so, the yellow metal remains on the back foot for the second consecutive day while ignoring the mixed catalysts. The reason could be traced from the US dollar’s pause after a three-day losing streak.

Trade, stimulus and virus remain as the key catalysts…

Be the postponement of the US-China trade review or the surge in the coronavirus (COVID-19) cases, not to forget the call to restore US Congress, each one of them manages to direct the market’s risk-tone sentiment off-late. Though, their mixed nature troubles the bullion traders.

The delay in the bi-annual trade review meeting between Beijing and Washington joins the firming up of the virus figures from Australia, France and Tokyo to negatively affect market sentiment. Also joining the league is Japan’s preliminary reading of Q2 GDP that slumped -27.8%.

On the contrary, news that the US House Speaker Nancy Pelosi wrote Senators to return from their month-long vacation, announced Thursday, helped trigger hopes of breaking the stimulus deadlock even if the agenda for the recall is limited to protect postal services. It should also be noted that New Zealand’s Prime Minister (PM) Jacinda Ardern pushed back the general election date by four weeks to October 17 as the virus woes firm in the Pacific nation.

Amid all these catalysts, S&P 500 Futures rise 0.27% but Japan’s Nikkei 225 and Australia’s ASX 200 mark losses by the press time. Additionally, the US 10-year Treasury yields also pause the latest run-up around 0.70% as we write.

Considering the lack of major data/events scheduled on the calendar, traders will keep eyes on the news/macros for fresh impulse. As a result, headlines concerning the US COVID-19 aid package, virus figures and Sino-American trade relations will be the key to watch.

Technical analysis

Although multiple resistances around $1,980 questions the metal’s short-term upside, sellers will have to wait for a daily closing under a 50-day EMA level of $1,868 before taking entries.