Date: 24 Jul 2020
The dollar continues to lose ground to other major currencies, during early Friday trading. The US dollar index declined by more than 1.3% this week, a sign of weakness that can be explained by two main factors: The prevalence of a risk-on stance in the financial markets, fuelled by positive news arising from Europe and progress being made in the quest to produce a vaccine for COVID-19, that diminishes the safe haven allure that supported the greenback during some of the darker times of the pandemic; The second factor, contrasting with other countries that appear to have managed the situation better, is the deteriorating health crisis in the US, forcing a reversal in some states that had reopened for business and casting doubts over the country’s ability to drive a speedy economic recovery.
Ricardo Evangelista – Senior Analyst, ActivTrades
US Treasury Secretary Steven Mnuchin’s comments yesterday about the need for a stable US dollar, has not led investors to change their view on yellow metal, and gold fever remains huge.
Bullion is getting closer to $1,900, while the only resistance left for gold is the historical peak of 2011, which is just 1% above the current price.
Technically the first support zone could be found at $1,880, while price is attacking the psychological level of $1,900. Investors are still buying every single dip and pulling up prices.
Carlo Alberto De Casa – Chief analyst, ActivTrades
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