- Gold prices posted a two-day losing streak with an intraday low of $ 1,720.87.
- The President’s failure to use other military powers to tame the riots belatedly fueled the feeling of risk.
- With cautious optimism surrounding the coronavirus vaccine, hopes for an economic recovery are also weighing on bullion.
- US data, headlines about the protests, the virus and US-China relations will be important to watch.
Gold prices fell to $ 1,725.96, down 0.12% on a day, in the middle of Wednesday’s Asian session. Recent optimism in the market appears to have weighed on the precious metal as US stocks begin to flash positive signals.
Among them, news from Axios suggesting that US President Donald Trump backs down at the threat of using more military power to tame the protests seems to have caught the eye.
Similarly, cautious optimism on the part of the main American healthcare professional, associated with the economic recovery in Europe, could also have pleased risk takers.
Against this backdrop, yields on 10-year US Treasuries gained 1.8 basis points (bps) at 0.697%, while stocks in Japan, Australia and China also posted gains during the first trading hour. .
Despite this, the general weakness of the US dollar and the uncertainty surrounding the global economic impact of the pandemic are limiting the decline in the bullion.
In addition, the presence on the calendar of the US ISM non-manufacturing PMI, factory orders and ADP employment changes also pushes gold traders to be cautious.
A sustained break below the 21-day EMA level of $ 1,720 becomes necessary for the bears to return to a six-week-old support line near $ 1,700. Until then, fears of a new attempt by the listing to challenge the May high of $ 1,765.40 cannot be ruled out.