Home Forex News Gold (XAUUSD) Bullish Above $1700 Awaiting Fed Policy Report

Gold (XAUUSD) Bullish Above $1700 Awaiting Fed Policy Report

232
0
  • Gold Outlook
  • FED Report
  • Gold Long Term Catalysts

Gold (XAUUSD) held on to gains accrued in Tuesday trading session, on Wednesday morning, ahead of Federal Reserve Policy meeting report later in the day. On Tuesday, the yellow metal futures were up to 0.08% after rallying by close to 1.2% on Tuesday as concerns about global economic recovery post-COVID-19.

Gold Bullish Run

The Bullion has been on an impressive run rallying by more than 9% since the start of the year. The rally was curtailed last week as optimism about economic recovery post-COVID-19 rocked the markets. A strengthened dollar also sent the precious metal tumbling below the $1700 an ounce level.

Investor’s sentiments about gold investments have improved in recent days amidst concerns over the second wave of coronavirus infections. Sentiments around gold have also improved on the dollar weakening against a basket of other major currencies in recent trading sessions.

While gold has remained bullish for the better part of the year, it has struggled to rally and find support above the $1750 price level. A lack of new catalysts has been the major undoing crippling further upside action past the critical resistance level.

FED Focus

The focus in the market is on the much-awaited U.S Federal Reserve Policy report late on Wednesday. The market expects the FED to unveil a new wave of stimulus measures highly needed to steer the U.S economy that has felt the full force of the COVID-19 pandemic.

Stimulus plans have helped strengthen sentiments about equities seen by a recent bounce back to all-time highs. Gold spot prices are highly reactive to U.S economic growth. Any signs of struggles or slowdown could see traders betting on the yellow metal as a safe-haven

Turmoil in the U.S economy ahead of the much-awaited November presidential election should continue to fuel demand for gold. Chief investment officer at Guggenheim Investments, Scott Minerd, believes investing in gold should help offset concerns about the status of the U.S dollar as a global reserve currency amidst the looming economic recession.

LEAVE A REPLY

Please enter your comment!
Please enter your name here