After yesterday’s sell-off on European stock markets, gold is remaining steady just above $1,900. Rising figures of Covid-19 infections are increasing fears of more lockdowns with all the related consequences. In other words, the impending need for more monetary stimulus to mitigate the impact of the coronavirus-induced crisis is keeping investors’ gold appetite at its peak. That said, we should be cautious as at some point central banks will start to be more resistant in adding new stimulus, but this scenario is far from imminent.
From a technical point of view, gold still appears in a positive mode but for further rallies, we would need to see a clear breakup of the $1,920-$1,930 level. A fall below $1,880 and later on below $1,860 would denote weakness.
