The dollar continues to decline versus its peers during early Monday trading, as the number of COVID-related fatalities reached 170,000 in the US and political partisanship in Washington, between Democrat and Republican lawmakers, prevents the signing off of a much needed financial stimulus package for an economy that now counts more than 30 million people as unemployed. There may be more downside risks ahead for the dollar as many investors, including large funds, have turned bearish towards the greenback.
Ricardo Evangelista – Senior Analyst, ActivTrades
Gold price is consolidating above $1,950, remaining around $120 below the peak reached less than two weeks ago, but still 28% up from the beginning of the year. This period of consolidation comes after a massive rally, followed by a sharp decline.
The price rebounded on the support zone of $1,870, finding another support zone at $1,920-$1,930. In the last few days volatility spiked up, while on Friday the price tried to stabilize after these massive movements. We will have a new bullish signal with a clear surpass of $1,965, in a scenario that remains dominated by coronavirus news and fears of further lockdowns. Expectations for further actions by central banks remain ever present and this is another supportive element for gold. A fresh decline below the support zone of $1,920-$1,930 would denote weakness.
Carlo Alberto De Casa – Chief analyst, ActivTrades