Gold consolidates losses after finding support at $1,850
Gold was trading in consolidation on Tuesday after falling sharply on Monday on news of progress on a vaccine against the coronavirus.
On Monday, the XAU/USD fell 4.58%, its worst day since August 11. After trading above 1,960 at its highs since September 16, it dropped to its low since September 28 at 1,850 an ounce.
The recent decrease in the precious metal prices was the news about the progress made by Pfizer and BioTech for a vaccine against COVID-19. These companies obtained a satisfactory response of 90%.
At the time of the news, the market got suddenly excited. The Dow Jones posted one of its best starts in history, the dollar also posted gains and gold slipped.
Market experts do not expect things to change much in the long-term outlook for gold
Tuesday, the XAU/USD was recording a 0.55% recovery on the day by trading at $1,871. However, the metal is under pressure from the risk appetite in the market. Besides, there is a sentiment that with a vaccine against COVID-19, the global economy will recover earlier than expected, and approval of large packages of stimuli will not be necessary.
However, market experts do not expect things to change much in the long-term outlook for gold. According to Gareth Soloway, market strategist at InTheMoneyStocks.com believes that fundamentals remain the same. He does not think that anything substantial has changed. Everybody knew that a vaccine was coming. The projections are still for the first quarter, the beginning of the second quarter, he said. Same with Biden’s arrival in the White House, the market economy doesn’t change much.
Silver extends losses below 24.00
On the other hand, silver continued to fall on Tuesday after having experienced a bad day on Monday as well.
At the beginning of the week, on Monday, the XAG/USD fell from $26.00 – its high since September 21. The white metal was trading at $23.57. At the end of the trading session, it bounced and closed at $24.07 with a 6% loss on the day.
However, on Tuesday, silver resumed its decline against the dollar and dropped from $24.00 once again. The precious metal was trading at $23.95, which is a 0.49% decrease on the day.
Gold futures were bouncing higher in Tuesday’s session after plummeting more than $90, or 5%, in the previous session. December gold futures were trading $1873.30, up $18.90 or +1.02%.
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