Gold price seesaws today looking for direction as mixed signals from the coronavirus front continue to weigh on markets. The previous week gold managed to return above the 50-day moving average as the fears of a second coronavirus wave rise and investors turn to safe-haven assets.
Yesterday the announcement by Fed that it will start purchasing U.S. corporate bonds in an attempt to secure liquidity for companies and credit markets amid the coronavirus crisis boosted risky assets and sent gold price sharply lower.
A warning from the U.S. FDA that the Remdesivir drug is not very effective with the coronavirus treatment might send some investors back to the safe-haven assets.
Investors today will focus on Fed Chair Jerome Powell testimony before the Senate Banking Committee at 14:00 GMT.
The gold to silver ratio rebounds from the three-month lows but still hover below the 100-day moving average.
Gold price is 0.07% lower at 1,723 as the correction from two week high continues for the second day amid an improvement in investors sentiment. The technical picture for gold remains positive as long as the gold price trades above the 50-day moving average at 1,712.
On the downside, the initial support for gold price stands at 1,722 the daily low, while more buying interest might emerge at 1,712 the 50-day moving average. In case the sellers continue the pressure, then the next support zone stands at 1,704 the low from June 15.
On the contrary, first resistance stands at 1,732 the daily high. If the gold price breaks above 1,732, then the next hurdle would be met at 1,737 the high form yesterday’s trading session. Next supply zone would emerge at 1,745 the top from June 2.