The US dollar continues to lose ground
The US dollar continues to lose ground to other major currencies during early Friday trading, as the markets price in the changing political landscape in Washington. It is now beyond any reasonable doubt that President-elect Joe Biden will be sworn-in on January 20. The new administration has ambitious stimulus plans for the US economy and the first year of the incoming President’s mandate is likely to be marked by a coordination of market-friendly fiscal and monetary stimulus, which is likely to keep the greenback under pressure.
Ricardo Evangelista – Senior Analyst, ActivTrades
The breakdown of the support level of $1,850 has damaged the medium-term trend for gold, opening space for further correction. Positive news regarding Covid vaccines has pushed investors to bet on riskier assets, temporarily reducing their exposure to gold.
With US markets working shorter hours today due to the Thanksgiving long weekend, there are good chances of seeing a relatively quiet trading session with the bullion price moving laterally in the range of the last few days between $1,800 and $1,810. A decline below $1,800 could trigger new selling of the yellow metal, although any return to risk-off strategy together with a weaker dollar would boost gold. For the time being the price is steady, just a few dollars above the four-month low.
Carlo Alberto De Casa – Chief analyst, ActivTrades
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and as such is to be considered to be a marketing communication. All information has been prepared by ActivTrades PLC (“AT”). The information does not contain a record of AT’s prices or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of futures performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk.