Gold’s Recent Up-Move Appears to be Supported by a Combination of Factors

Gold’s Recent Up-Move Appears to be Supported by a Combination of Factors

Gold (XAU/USD) took advantage of its recent uptick to record a new one-week high in the early Asian session today. The yellow metal opened the week on a positive (bullish) note and is supported by a collection of factors. The USD suffered a sharp drop due to the pressure coming from widespread protests across the country over the death of George Floyd by the Minneapolis police. This caused a massive USD sell-off which has been beneficial for the metal commodity.

The yellow metal is also supported by the continuous rise of Covid-19 cases across the globe which has given more credence to Gold’s safe-haven status. However, the recent glimmer of hope for a potential COVID-19 vaccine, the easing of lockdown restriction across the globe, and expectations of a “V-shaped” recovery curve for the global economy has capped any strong rally in the near term.

Investors also became optimistic after US President Donald Trump initiated the process to strip Hong Kong of its special status but did not dishonor the US-China phase-one trade deal. Neutral data release in China’s manufacturing sector also bolstered investors’ overall confidence in Gold.

XAUUSD – Daily Chart

Gold (XAU) Value Forecast — June 1

XAU/USD Major Bias: Bullish

Supply Levels: $1,745, $1,754, and $1,763

Demand Levels: $1,730, $1,722, and $1,717

Gold (XAU/USD) continues to show strong bullishness above the $1,730 pivot. We’re likely to see more volatility in the coming Asian session.

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