Gold pares early gains, remains below $1900 mark
- A softer tone surrounding the USD assisted gold to gain some traction on Wednesday.
- The risk-on mod, surging US bond yields capped the commodity below the $1900 mark.
- Wednesday’s release of the FOMC policy meeting minutes eyed for a fresh impetus.
Gold trimmed a part of its intraday positive move and was last seen trading with modest gains, just below the $1890 region.
The XAU/USD managed to regain some traction on Wednesday and recovered a part of the previous day's sharp intraday pullback of around $45 from the $1920 region, or two-week tops. The uptick was exclusively sponsored by a subdued US dollar price action, which tends to underpin demand for the dollar-denominated commodity.
However, a recovery in the global risk sentiment – as depicted by a goodish rebound in the US equity futures – dented the precious metal's safe-haven status. The risk-on mood was reinforced by a strong pickup in the US Treasury bond yields, which further collaborated to keep a lid on the intraday uptick for the non-yielding yellow metal.
The upside for the XAU/USD remains capped below $1900 round-figure mark as investors now look forward to the release of the latest FOMC monetary policy meeting minutes. This, along with the broader market risk sentiment, will influence the commodity and assist traders to grab some meaningful trading opportunities during the US session.
From a technical perspective, the overnight sharp pullback indicated to the emergence of some fresh selling around the commodity. The subsequent price action suggests the lack of any strong bullish conviction. Hence, a subsequent fall towards the $1858 intermediate support, en-route the recent swing lows, around the $1850-49 region, now looks a distinct possibility.
Technical levels to watch