Gold price edges up to $1490 area, lacks follow-through

New York (Oct 22)  Gold edged higher through the early European session on Tuesday and is currently placed at the top end of its daily trading range, around the $1489 region.

 

 Following an early tick lower to near one-week lows, the precious metal managed to regain some positive traction and recovered a part of the previous session's modest downtick. The US President Donald Trump's overnight comments raised hopes for a possible resolution of the prolonged US-China trade disputes and weighed on the precious metal's safe-haven demand.

Cautious mood helped gain some traction

However, a combination of supporting factors helped limit any follow-through selling, rather attracted some fresh dip-buying interest. A subdued US Dollar demand, amid firming expectations that the Fed will cut interest rates further at its upcoming meeting on October 29-30, was seen as one of the key factors lending some support to the dollar-denominated commodity - Gold.

 

 This coupled with a sharp intraday fall in the US Treasury Yields, possibly in the back of a softer mood around equity markets, further underpinned the non-yielding yellow metal and remained supportive of the intraday uptick. The commodity remained well within a near two-week-old trading range, warranting some caution before placing any aggressive directional bets.

 

 There isn't any major market-moving US economic data due for release on Tuesday and hence, the broader market risk sentiment, coupled with the USD price dynamics might continue to act as key drivers of any meaningful intraday momentum.

FXstreet

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