The deafening news shocked the whole world yesterday: the British Queen Elizabeth II died peacefully at the age of 96…
Gold dropped on vaccine rollout
Information is not investment advice
XAU/USD has been falling due to market optimism. Will it keep moving down?
First of all, the FDA approved the vaccine of Pfizer and BioNTech for emergency use. That’s why the market sentiment improved, and investors streamed their capital to riskier currencies and stocks. Elsewhere, the EU and the UK agreed to continue negotiating, giving a signal that the deal may be reached soon. The prospect for the Brexit agreement added to the risk-on sentiment as well. Even hopes for the additional US stimulus package and the massive USD selloff haven’t helped gold to rise.
XAU/USD is moving inside the descending channel. It is approaching the key support of the 200-day moving average of $1 810. Gold is unlikely to break it down for the first attempt. That’s why we can expect it will bounce off this level initially. If it manages to break it down, it may drop to the next support at the low of November 30 at $1 770. On the flip side, the move above the recent highs of $1 845 will drive XAU/USD to the 50-period moving average of $1 870, which it has failed to cross several times. In a nutshell, gold is stuck between two moving averages.
After months of pressure from the White House, Saudi Arabia relented and agreed with other OPEC+ members to increase production.
Despite the negative news and worrying headlines, we recommend traders to make mental reframing of the situation. This way, you can look at the market from a different perspective. Let’s observe how you can take advantage of the uncertainties and make the fundamentals work for you!
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