- Gold has bounced from key average support amid risk-on in Asian stocks.
- The S&P 500 futures are flashing red and are likely pushing gold higher.
- Fresh easing by major central banks is supportive of gains in gold.
Gold is showing signs of life in Asia despite the uptick in the Asian stocks.
The yellow metal is currently trading at $1,638 per Oz, having defended the 200-hour moving average line at $1,634 during the overnight trade.
The Asian equities are flashing green with Japan’s Nikkei index adding 0.70% at press time. Other regional heavyweights like South Korea’s Kospi, Hong Kong’s Hang Seng and the Shanghai Composite are also reporting moderate gains.
The US stocks rallied Wednesday, pushing gold lower from $1,652 to $1,635 as the US lawmakers reached an $8.3 billion emergency coronavirus bill aimed at fast-tracking research and development for treatments and a vaccine, sending stocks higher.
Wall Street, however, may open Thursday on a negative note, as the futures on the S&P 500 are currently down 0.80%. The losses in the US index futures could be drawing bids for the safe-haven yellow metal.
If the Asian stocks turn lower, taking cues from the S&P 500 futures, the bid tone around the yellow metal will likely strengthen.
The broader outlook for the metal is constructive, as major central banks have turned accommodative to contain the negative impact of the coronavirus outbreak on the economy. Both the Federal Reserve and the Bank of Canada have cut rates by 50 basis points this week. The Reserve Bank of Australia also reduced rates by 25 basis points on Tuesday.
Technical levels
Share
