- Gold met with some fresh supply on Monday and retreated farther from $1745 resistance zone.
- The downtick seemed unaffected by the prevalent risk-off mood and a subdued USD demand.
- Renewed coronavirus jitters dented the global risk sentiment, albeit did little to impress bulls.
Gold edged lower through the early European session and was last seen trading near the lower end of its daily range, below the $1720 level.
Following last week’s failed attempt to break through the $1745 resistance zone, the commodity met with some fresh supply on the first day of a new trading week and dropped to multi-day lows. The downfall seemed rather unaffected by a selloff in the equity markets, which tend to undermine the precious metal’s safe-haven status.
Fears about the second wave of the coronavirus outbreak and the possibility of renewed lockdowns to curb the spread dampened prospects for a sharp V-shaped economic recovery. This comes on the back of the Fed’s bleak outlook for the US economy, which along with disappointing economic data from China weighed heavily on investors’ sentiment.
The risk-off mood was reinforced by a fresh leg down in the US Treasury bond yields. The combination of factors failed to impress bulls or extend any support to the non-yielding yellow metal. Even a subdued US dollar price action also did little to provide any meaningful impetus to the dollar-denominated commodity.
It will now be interesting to see if the commodity is able to attract any dip-buying or continues with its retracement slide amid absent relevant market moving economic releases from the US.
Technical levels to watch
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