Gold continues to regain lost ground amid weakening USD and a decreased risk appetite of investors.
Demand for risky assets began to decline sharply after reports from the medical news site STAT, which questioned the effectiveness of the vaccine from Moderna, due to the lack of detailed information of their research and testing. Hopes for a quick victory over COVID-19 and a global economic recovery have fallen. Under these conditions, many traders again began to give preference to gold and other protective assets.
USD also provides considerable support for gold. Since the beginning of the week, the American dollar has been quite actively losing its position on the market. Pressure on the US currency is exerted by a number of important fundamental factors, including speculation on the possible negative interest rates by the FRS. On Monday, Jerome Powell rejected these assumptions, but the market continues to actively discuss this topic. Goldman Sachs analysts believe that the arguments in favor of this measure are strengthening, but in the near future the Federal Reserve is unlikely to take this step.
The demand for gold is also supported by reports of worsening relations between the US and China.
Today, in the economic calendar, the market will follow the publication of the last FOMC meeting transcripts.
Bears could not push support at 1729.00 and the price resumed its upward movement. Price is constrained above the mark of 1740.00, so the medium-term priority scenario is growth of quotations towards the level of 1765.00.
Resistance Levels: 1765.00, 1780.00, 1800.00;
Support Levels: 1740.00, 1729.00, 1695.00.
The main scenario - a correction towards 1740.00 and an increase in the direction of 1765.00.
An alternative scenario - growth by 1765.00 from current levels.
The current fundamental outlook is moderately positive. We consider longs from the levels of 1740.00 and 1729.00.
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