Gold prices have given up gains notched during the London session, as the New York session kicks in.
News of 94.5% efficacy in the clinical trials of Moderna’s coronavirus vaccine candidate spurred some measure of risky sentiment, which capped the initial gains of gold prices and are now forcing a retreat from intraday highs.
Gold started the day lower but picked up steam as open interest in gold futures jumped for the 3rd day in a row by 3,200 contracts, according to data from the CME group. However, gold buyers have become more cautious as the day drags on after positive news from China helped to reinforce risky sentiment in the markets. Volume has also dropped by 75,700 contracts, as per CME Group’s data.
Gold price is now trading at 1888.49 as at the time of writing, down by 0.01%.
Technical Outlook for Gold Price
Gold price action on the XAUUSD daily chart shows that price has met resistance at the 1900.76 price level, as has been the case several times in the past. This level is the level to beat for buyers. However, Moderna’s vaccine news could put a dampener on the attempt by bulls to surmount 1900.76. This could prompt a rejection and possible selloff that targets 1881.94, with further support seen at 1869.39 and also at the 78.6% Fibonacci retracement level of 1850.29.
On the flip side, we could see a break of 1900.76 if bulls can mount a successive offensive at that level, opening the door for gold price activity to head towards the 1918.68 resistance as the initial target. Above this level, 1940.15, 1954.77 and last week’s highs close to 1969.95 all find themselves as potential upside targets.
XAUUSD Daily Chart