XAU/USD treads water above $1,900 even as US Pres. Trump leaves hospital

  • Gold refreshes intraday high while breaking a $2 range below $1,915.
  • US President Donald Trump leaves Walter Reed, tweets to regain the presidential election campaign trail soon.
  • White House blocks US FDA proposal to delay emergency approval of COVID-19 vaccine.

Gold prices pick-up bids near $1,914 as markets in Tokyo open for Tuesday’s trading. The yellow metal traders cheered recovery in market sentiment the previous day while regaining $1,900 the previous day. However, the recent risk reset seems to have probed the bulls. Even so, traders stay optimistic as US President Trump leaves the hospital after a brief stay to cure the virus infection.

Risk-on probed but Trump keeps the bulls hopeful…

Although the US Food and Drug Administration’s proposal to tighten the checks for the COVID-19 vaccine gets rejected by the White House, S&P 500 Futures await fresh clues to extend the previous day’s run-up while staying below the 3,400 threshold. The pause in the risk-on mood can also be witnessed in the mildly positive performance of Japan’s Nikkei 225 and a 0.38% loss of Australia’s ASX 200.

Earlier in Asia, US President Donald Trump finally left Walter Reed hospital and felt as “20 years younger” while showing readiness to regain the election bets that have been favoring a sweeping Democratic victory off-late. Also on the risk side could be the update from the US National Hurricane Centre that suggested Delta has turned into a hurricane while expecting a landfall on the Gulf Coast by Thursday evening.

During Monday, News of the US President Trump’s health recovery and increasing odds of Brexit has joined expectations of further stimulus from America to keep the risks positive. The same dimmed the US dollar’s safe-haven demand and pressured the gold prices upwards. Also favoring the market optimism could be upbeat US ISM Services PMI data.

Looking forward, RBA and Aussie budget are the main headlines during the Asian session amid China’s off and a light calendar elsewhere. It should, however, be noted that the main catalysts will be Trump’s health updates and next moves.

Technical analysis

FXStreet’s Rajan Dhall highlights the falling trend line from early-August while saying,

There are a couple of key resistance levels on the chart to watch out for. The first and stronger of the two is the red line at USD 1915 per troy once. This level has been used as support on many occasions and the price is currently stalling at the area. The second is the downward sloping trendline marked in green. This level has been tested four times and a break could be a bullish signal. Finally, a test and break of the previous wave high at USD 1973.64 per troy ounce would end a run of consecutive lower highs and lower lows. 

Read: Gold Price Analysis: XAU remains under a key level and it will need to be broken if the bulls are to take control again

Read More: XAU/USD treads water above $1,900 even as US Pres. Trump leaves hospital

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