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Gold surged amid fears of rising Covid-19 cases

1 Jul 2021 11:33 AM

Gold prices witnessed some gains in today's trading, as concerns about the delta variant most contagious of Covid-19 boosted the yellow metal's safe-haven appeal, ahead of US jobs data seen as crucial to the Federal Reserve's policy outlook.

Investors are now waiting for the US Non-Farm Payrolls report due on Friday for clues about the Fed's next move.

Dallas Federal Reserve Bank President Robert Kaplan said Wednesday that he would like the Fed to start reducing its support for the economy before the end of the year, in part to reduce the likelihood of a sudden policy tightening later. Raising the interest rate will increase the opportunity cost of holding bullion, reducing its attractiveness.

Gold is currently trading around the levels of $1,775 per ounce below the simple moving average 50, and while staying below it is expected that prices will return to the support area around the levels of $1,760/1.755 per ounce, and this area will be crucial to determine the path of gold during the upcoming period, and trading below will be key of way to the $1,720 levels.

However, any return to trading above the levels of 1,800 dollars, supporting a new rise in prices to levels 1,825, and then 1,840 levels.

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