Gold Comes Under Renewed Pressure Following Fresh Moderna Vaccine Update

Gold Comes Under Renewed Pressure Following Fresh Moderna Vaccine Update

Gold (XAU/USD) traded on a positive note though the early European session and renewed its daily high above $1900. However, just a few minutes ago, it got reported that Moderna’s (NASDAQ: MRNA) COVID-19 vaccine candidate has yielded a 94.5% effectivity in preventing the Coronavirus disease, which caused the safe-haven asset to plunge dramatically.

Meanwhile, before the recent drop, the yellow metal found it hard to secure its footing above the $1900 mark, despite a goodish bounce from the $1857 level. This weakness was due to the strong pickup in the US dollar (DXY) across the board.

The previous market optimism over a vaccine from Pfizer faded as a result of questions over the distribution, dosage, and shelf life of the vaccine. Additionally, the growing number of COVID-19 infections in the US and all over the world dampened the recently found market risk mood.

However, renewed lockdown restrictions in some US states and expectations of heavy December restrictions in Germany threaten the global economic recovery, which weighed heavily on the US Treasury bond yields. These factors have extended some support to the non-yielding commodity in the meantime.

Moving on, market participants will be looking at new developments surrounding Wall Street and the Coronavirus saga today amid the absence of any significant economic releases from the US.

XAUUSD – Hourly Chart

Gold (XAU) Value Forecast — November 16

XAU/USD Major Bias: Sideways

Supply Levels: $1887, $1900, and $1923

Demand Levels: $1865, $1857, and $1849

Gold is trading in a decent upwards pattern as market risk weakens. However, it is unclear what dynamics the recent Moderna news would bring into the market.

The recent drop got swiftly supported by the $1865 level, where the base of our ascending channel lies. We expect to see a retest of the $1900 resistance again in the near-term. At press time, gold is trading at $1874. The $1865 support should repel any fall from this level.

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.

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Author : Azeez Mustapha

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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.