Gold gained some strong positive traction on Monday amid some aggressive USD selling.
Upbeat US ISM Non-Manufacturing PMI did little to provide any respite to the USD bulls.
The upbeat market mood might turn out to be the only factor capping gains for the metal.
Bulls now wait for some follow-through strength beyond the key $1800 psychological mark.
Gold edged higher through the early North American session and has now moved well within the striking distance of multi-year tops set last Wednesday.
The precious metal built on last week’s rebound from the $1757-58 region and gained some strong follow-through traction on the first day of a new trading week. The momentum was exclusively sponsored by the heavily offered tone surrounding the US dollar, which tends to underpin demand for the dollar-denominated commodity.
The greenback added to its recent losses and failed to gain any respite from a goodish pickup in the US Treasury bond yields. Even Monday’s release of stronger-than-expected US ISM Non-Manufacturing PMI, which jumped to 57.1 in June as against a rise to 50.1 expected from 45.4 previous, did little to impress the USD bulls.
The commodity was further supported by concerns that the ever-increasing coronavirus cases could trigger renewed lockdown measures. Adding to this, possibilities of some short-term trading stops being trigger above the $1778-80 region further seemed to have collaborated to the metal’s uptick over the past hour or so.
However, the upbeat market mood – supported by hopes of a sharp V-shaped global economic recovery – might keep a lid on any further gains for the precious metal. Nevertheless, bulls might still aim for a move towards the ambitious $1800/ounce target, above which the commodity is more likely to extend the upward trajectory.
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