Gold (XAU/USD) traded on a sideways momentum through the early European session on Monday between the $1819 resistance and the $1808 support. The yellow metal appears to have attracted some dip-buyers over the past few hours and might build on Friday’s bullish recovery from its recent decline to a two-month low.
However, the uptick lacked any obvious fundamental catalyst and could get capped by the prevalent market risk mood.
Meanwhile, massive strides in mass COVID-19 vaccinations continued to bolster optimism for a strong global economic recovery. This factor, coupled with the proposed $1.9 trillion US fiscal stimulus plan, further improved investors’ risk confidence and extended additional support to the prevailing rally in the equity markets. Consequently, this market sentiment could prevent investors from placing aggressive bets on gold.
In other news, expectations of a massive government borrowing to fund the stimulus caused the 10-year US Treasury bond yield to spike to a one-year high. The prevailing surge in the US bond yields has helped revived strong demand in the US dollar (DXY), which tends to undermine demand for the dollar-denominated commodity.
Moving on, there are no major market-moving data releases from the US today, making it advisable to wait for some follow-through momentum before confirming any trend. In the meantime, the prevailing market risk sentiment will continue to influence the price action of the precious metal.
Gold (XAU) Value Forecast — February 8
XAU/USD Major Bias: Sideways
Supply Levels: $1819, $1827, and $1838
Demand Levels: $1808, $1800, and $1787
Gold posted strong gains on Friday, following a steep decline to a two-month low around $1785. At press time, the commodity is trading at $1811, as it continues on a range-bound momentum amid the absence of any catalysts.
That said, it seems unlikely (not impossible) for gold to fall below the $1808 support in the meantime, as we expect a bullish recovery to the $1838-50 level later in the North American session today.
Note: Learn2.Trade is not a financial advisor. Do your research before investing your funds in any financial asset or presented product or event. We are not responsible for your investing results.
- Broker
- Min Deposit
- Score
- Visit Broker
- Award-winning Cryptocurrency trading platform
- $100 minimum deposit,
- FCA & Cysec regulated
- 20% welcome bonus of upto $10,000
- Minimum deposit $100
- Verify your account before the bonus is credited
- Over 100 different financial products
- Invest from as little as $10
- Same-day withdrawal is possible
- Fund Moneta Markets account with a minimum of $250
- Opt in using the form to claim your 50% deposit bonus
Learn to Trade
Never Miss A Trade Again
Signal Notification
Real-time signal notifications whenever a signal is opened, closes or Updated
Get Alerts
Immediate alerts to your email and mobile phone.
Entry Price Levels
Entry price level for every signal Just choose one of our Top Brokers in the list above to get all this free.