Stocks, oil, and risk currencies gained on Tuesday as the formal go-ahead for US President-elect Joe Biden to begin his transition burnished a November already boosted by Covid-19 vaccines.
XAU/USD: gold may weaken
Information is not investment advice
The technical necessity of a downturn was visible in XAU/USD for a long time. Yet, gold made an attempt to strengthen in May but was stopped by resistance just above $1,300. The price is now once again below this key level. Last week’s bearish candlestick on W1 has a long upper wick. This is a negative sign. Both weekly and daily Awesome Oscillators are declining.
The USD has been leading as a safe haven during the last several days, and this situation is likely to continue. Some risks/volatility in this scenario will be related to the publication of the FOMC meeting minutes on Wednesday. The USD will be fine and gold will decline if the minutes are not dovish (if the Fed's members really didn't consider a rate cut).
XAU/USD now has several support levels: 100-week MA at 1,277.25 (now above the price but not far), 1,275.50 (38.2% Fibo of the 2018-2019 advance), 1,266.15 (this year’s lows). It’s possible to trade between these support levels or on the break below the latter).
EUR/USD fell below 1.1850 after reaching 1.1920 on Monday. The pair consolidated after the initial bearish move.
USD/CAD remains within a downtrend. As a result, selling the pair as it turns down from resistance is the best strategy. Support lies at 1.3125.
Asian equity markets traded cautiously after the mixed lead from Wall St where most indices stalled at record levels
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