Gold clings to gains near session tops, above $1950 level

Gold traded with a positive bias through the early European session and was last seen trading near the top end of the daily range, just above the $195  |  18/09/2020 09:10
  • Gold regained positive traction and recovered a major part of the overnight losses.
  • Sustained USD selling extended some support to the dollar-denominated commodity.
  • A caution mood around the equity markets further benefitted the safe-haven metal.

Gold traded with a positive bias through the early European session and was last seen trading near the top end of the daily range, just above the $1950 level. A combination of supporting factors assisted the previous metal to regain positive traction on the last trading day of the week and recover a major part of the previous day's losses to over one-week lows.

The US dollar struggled to capitalize on the post-FOMC short-covering bounce, instead met with some fresh supply following Thursday's mostly disappointing US macro data. The USD remained depressed through the first half of the trading action on Friday, which, in turn, was seen as a key factor that underpinned the dollar-denominated commodity.

This comes amid concerns about the second wave of coronavirus infections and fading optimism over a sharp V-shaped global economic recovery. Adding to this, a softer risk sentiment – as depicted by the prevalent cautious mood around the equity markets – benefitted traditional safe-haven assets and remained supportive of the bid tone surrounding the precious metal.

Despite the positive move, the commodity remains well within a familiar trading range held over the past one week or so. Moreover, the yellow metal has been struggling to break through a one-month-old descending trend-line resistance. This makes it prudent to wait for some strong follow-through buying before positioning for any further near-term appreciating move.

Market participants now look forward to the release of the Michigan Consumer Sentiment Index for September, scheduled later during the early North American session. The data might influence the USD price dynamics, which, along with the broader market risk sentiment, will be looked upon for some short-term trading opportunities.

Technical levels to watch

 

Share

Popular News

Show More Popular News

Market Insight's Views

Market Insight analyses will provide both fundamental and technical comprehensions on FX
and other asset classes for Market Insight viewers

RISK WARNING

The information provided herein is for general informational and educational purposes only. It is not intended and should not be construed to constitute advice.

If such information is acted upon by you then this should be solely at your discretion and GKFX will not be held accountable in any way.

  • ForexF
  • IndicesI
  • CommoditiesC
        Back

        Login to Market Insight Account

        Your Market Insight account gives you access to the tools that we offer our customers including our
        Technical Studies & Sentiment for your accounts.

        Forgot Password?

        Don't you have a Market Insight account? With a few easy steps you can easily register to Market Insight

        Create a Market Insight's Account

        Your Market Insight account gives you access to the tools that we offer our customers including our Technical Studies & Sentiment for your accounts.

        register_ty

        Thank you!

        Welcome to Market Insight family!

        You have succesfully completed the registration.
        We will send you an e-mail to give you some
        instructions and our Terms and Conditions!
        Our account representatives will be contacting you as
        soon as possible. If you have any further questions
        please do not hesitate to mail us via info@marketinsight.com