Gold price (XAU/USD) pares intraday gains around $1,753 during the early hours of Thursday morning in Europe. Even so, the precious metal prints a three-day winning streak amid the market’s cautious optimism.
The commodity’s latest pullback could be linked to the consolidation ahead of the European session openings, after witnessing a sluggish Thursday due to the Thanksgiving holiday. Also likely to test the XAU/USD bulls are the Covid fears from China.
However, receding fears of the US Federal Reserve’s (Fed) aggressive rate hikes, especially after the previous day’s Federal Open Market Committee (FOMC) Meeting Minutes, keep the gold buyers hopeful. On the same line are the hopes for Chinese government stimulus and a cut to the People’s Bank of China’s (PBOC) Reserve Requirement Ratio (RRR), as well as hopes of quick recovery from the COVID-19-led grim economic conditions.
Amid these plays, the S&P 500 Futures join firmer Asia-Pacific shares to print mild gains but the Treasury yields are inactive amid the Thanksgiving celebration in the US. Further, the US Dollar Index (DXY) remains pressured towards the monthly low near 105.35, around the weekly low of 105.63 by the press time.
Looking forward, a light calendar and holiday mood in the US could challenge the gold traders but the buyers are likely to keep the reins