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Daily market commentary: Gold touches a new 3-week-high



FOREX

The US dollar continues to depreciate against other major currencies, having fallen to a new year low during early Thursday trading. The greenback’s losses come following a combination of market friendly news, which include positive signals from US lawmakers regarding a bipartisan agreement on an economic stimulus package, growing confidence in multiple COVID vaccines, and an increasingly likely post-Brexit trade deal between the EU and the UK. Inspired by this cocktail of good news and by the Federal Reserve’s latest statement, where they pledged to maintain low interest rates until 2024, investors are embracing riskier assets and walking away from the safe-haven dollar.

Ricardo Evangelista – Senior Analyst, ActivTrades

daily market analysis

GOLD

A weak US dollar combined with a new stimulus and a dovish Fed have created the perfect scenario for a new rebound for bullion. After some initial uncertainty, the positive momentum that has driven gold in the last few days has accelerated with the price jumping above the resistance level of $1,872-$1,875 to touch a new 3-week-high, before some modest profit taking in the European morning.

Summarizing the last few weeks of gold, we could say that the news about vaccines pulled up stocks and crashed the gold price in November. After this initial movement, investors realized once again that central banks will be forced to print money and to keep generating stimulus. In short, interest in gold will remain huge for a long while yet.

Carlo Alberto De Casa – Chief analyst, ActivTrades


Disclaimer: opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.

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Daily market commentary: Gold touches a new 3-week-high

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