- Gold continued gaining traction for the third consecutive session on Thursday.
- Hopes for more US fiscal stimulus undermined the USD and benefitted the metal.
- Bulls seemed unaffected by the latest optimism over the first COVID-19 vaccine.
Gold edged higher through the early European session and climbed to eight-day tops, around the $1845 region in the last hour.
The precious metal built on this week’s goodish rebound from the $1764 region – the lowest level since early July – and continued scaling higher for the third consecutive session on Thursday. The uptick was exclusively sponsored by the prevalent selling bias surrounding the US dollar, which tends to benefit dollar-denominated commodities, including gold.
Wednesday’s disappointing ADP report on the US private-sector employment added to the market worries about the potential economic fallout from the continuous surge in new coronavirus cases in the United States. This, in turn, revived hopes for additional US fiscal stimulus and kept the USD bulls on the defensive through the first half of the trading action.
The positive move could further be attributed to some technical buying following the previous day’s sustained strength beyond the $1818-20 supply zone. Meanwhile, the latest optimism over the first approval of a vaccine for the highly contagious coronavirus diseases did little to prompt any selling around the safe-haven XAU/USD or hinder the ongoing momentum.
Moving ahead, market participants now look forward to the US economic docket – featuring the releases of Initial Weekly Jobless Claims and ISM Services PMI – for a fresh impetus. Investors will also keep a close eye on developments surrounding the US stimulus measures, which might influence the USD and produce some meaningful trading opportunities around the XAU/USD.
Technical levels to watch
