- XAU/USD erases gains after finding resistance at the $2050 zone.
- US Dollar losses strength during the American session, sill flat for the day.
Gold prices spiked to the upside after the beginning of the American session but then pulled back erasing gains. XAU/USD jumped to $2049.70/oz, and as of writing, it trades at $2033, practically at the same level it closed on Friday.
Like the US dollar, gold is moving without a clear direction on a quiet Monday despite rising tensions between the US and China. The developments over the weekend and also the arrest of Jimmy Lai, under the National Security Law did not alter markets, neither boosted gold. Market participants await definitions from Washington and also about the stimulus bill, despite the executive orders signed by Trump.
Main trend intact
The primary trend in gold continues to point to the upside. It is the first time in a week that XAUD/USD does not print fresh record highs. A correction seems overdue, but so far, no strong signs are seen. In the short-term, key support level might be seen at $2015 followed by $1980.
“We lift gold short-term targets to ~$2,100/oz. 6-12m targets breaching $2,300/oz seems plausible. The record pace of ETF investor inflows, a weakening US$ and negative real yields are the primary drivers for the push higher,” explained analysts at CitiBank.
