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Sunday, May 16, 2021
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    Gold and US Dollar Share Opposite Correlation

    Gold and US Dollar Share Opposite Correlation: The U.S. stocks advanced further as traders were motivated to see that some countries began to ease stay-at-home limitation and reopen businesses in states amid slowing new coronavirus diseases. The Dow Jones Industrial Average charged 358 points higher (+1.5%) to 24133, the S&P 500 rose 41 points (+1.5%) to 2878, and the Nasdaq 100 was up 51 points (+0.6%) to 8837.

    The U.S. Commerce Department will publish March’s wholesale inventories (-0.5% on month expected) and the advance goods trade balance (55.0 billion dollars deficit projected).

    RELATED: Global Exchange Group To Acquire UK Competitor

    The Conference Board will publish April Consumer Confidence Index (87.9 expected). S.P./Case-Shiller will describe the 20-City Composite Home Price Index for February (+0.4% on month expected).

    XAU/USD – Upward Trendline Support

    The safe-haven-metal prices failed to stop its 3-Day losing streak and dropped toward $1,700 an ounce while representing 0.53% losses on the day mainly due to a report about reopening the economies and loosening of months-long COVID-19 lockdown measures. As well as, the gains in stocks also keeps the gold prices under pressure.

    Currently, gold is trading at 1,709 and consolidates in the range between the 1,706.30 – 1,725.50. However, the traders are cautious about placing any strong position ahead of policy announcements from two of the world’s leading central banks.

    The precious metal dropped after U.S. equities hit the highest in almost 7-weeks mainly because most of the states, including Florida, showed a willingness to ease restrictions.

    Italy is one of the countries that hit hardest by coronavirus outbreak, also prepared to re-start the economy, although the World Health Organization has given warning about the coronavirus pandemic and said that the virus is still far from over.

    Despite the latest losses in yellow-metal, the quote is still trading near the 7-months high, mainly due to the coronavirus outbreak.

    In the meantime, they’re following the massive stimulus by Fed and central banks to support growth caused by the epidemic, while the Federal Reserve and the European Central Bank could make policy announcements on Wednesday and Thursday.

    Since the gold and U.S. dollar share the opposite correlation, gold prices also weighed down by the latest pullback in the U.S. dollar.

    As in result, the Market’s risk-tone remains mostly inactive with the U.S. 10-year Treasury yield taking rounds to 0.65% and getting mixed performances from the Asian stocks.

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