It has finally happened – Gold has staged a convincing break above the $1,800, hitting a high of $1,813.63 at the time of writing.
Despite the pullback, the price of gold remains buoyed by notable US dollar supply, as the risk sentiment rebounded on strong German factories data and conciliatory Fedspeak, suggesting that tapering is not on the table anytime soon.
Update: Gold price reverses the pullback from intraday high while picking up the bids to $1,790, up 0.15% intraday, ahead of Thursday’s European session.
Among them, Beijing’s dumping of the China-Australia strategic economic dialogue mechanism and pressure on the Japanese government to extend the third state of emergency beyond the May 11 deadline are the key factors that recently weigh on market sentiment.
The price of gold looks to build onto Wednesday’s rebound, as the US Treasury yields remain subdued amid dovish Fed expectations.
However, later she walked back on her words, which did help to calm markets and cap the gains in the greenback.
Gold prices continue to find support from the recent surge in the precious metals complex, especially with the price of Palladium sitting at record highs above the $3,000 mark.
After the US private sector employment rose only by 742K as against expectations of +800K in April, markets turn cautious ahead of the official NFP print.
An NFP disappointment could raise doubts on the strength of the US economic recovery, which could push back the Fed’s tapering expectations, rendering gold-supportive.
The move was sustained by rising open interest, indicative that the continuation of the uptrend remains in place in the very near-term.
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