The shining metal breaks above $1,760. How soon the 2012 heights may be beaten?
Gold fell below $1,700
Gold (XAU/USD) is declining for the second day in a row. The reason of such a dynamic is that risk-seeking investors have turned to stocks. It’s hard to ignore the surge of S&P 500, NASDAQ, and Dow Jones. More and more traders and investors want to take part in this rally, so they quit their gold longs and switch to indexes. US ADP employment report released today showed that the number of jobs in the US private sector declined in may less than expected. That has also contributed to the positive mood and reduced the appeal of the precious metal.
What does it mean for traders?
Traders can profit in indexes for sure, but don't forget that short positions in gold are also possible. The price is currently testing the 23.6% Fibonacci retracement level in the 1,690 area. The fix below this point will open the way down to $1,670 and $1,645.
At the same time, remember that gold is a safe haven. With various uncertainties that torment the world, the long-term trend for XAU/USD is bullish. As a result, every time the asset reaches support levels, it is necessary to look for the signals of bullish reversal.
Finally, the return above $1,700 (if the break to the downside turns out to be false), will allow bulls to try to push the price back up to $1,715 and $1,725.
Monitor the situation and be ready to profit!
The Reserve Bank of Australia will publish its statement and announce the interest rate on July 7, at 7:30 MT time.
The overall market sentiment was mixed after the USA recorded the largest increase in virus cases since May 9. The data even offset the better-than-expected NFP.
The risk-on tone is back on the market again. Let’s look at main trading opportunities.