The bullish momentum remaining intact as weaker Treasury yields and the dollar offer support to gold prices
Gold prices keep trending higher these days, retaining a bullish bias on Friday. The precious metal rose to the $1,760 area during the European hours, a break above which would open the way towards the $1,800 figure. The bullion was last changing hands around the mentioned intraday highs, with the bullish momentum remaining intact as weaker Treasury yields and the dollar offer support to gold prices.
Markets participants remain cautious amid the continued spread of the Delta covid variant cases and uncertainty over the Fed’s next monetary policy move. Still, European stocks climbed to fresh record highs on Friday after mixed trading in Asia. U.S. stock futures were edging higher ahead of Friday’s open. On Thursday, both the Dow and S&P 500 closed at a record for three consecutive days.
Later in the day, the US Preliminary University of Michigan consumer sentiment could provide fresh hints on the economy. The release could impact dollar dynamics and, in turn, gold. A downside surprise could weigh on the Fed’s tapering expectations which would be positive for gold prices. If the dollar keeps retreating during the US session, the bullion could add to intraday gains and finish the week marginally higher.
In a wider picture, gold prices need to regain the key simple moving averages in order to get back to long-term highs above $1,900 last seen in early-June. The initial hurdle is represented by the 20-DMA that arrives at $1,790, followed by the 100- and 200-DMAs, today at $1,804 and $1,814, respectively. On the downside, the yellow metal needs to hold above the $1,730 area if a pullback takes place in the coming days.