The downtrend in XAU / EUR limited critical support at € 1,567
- XAU / EUR plunges almost 1%, following in the footsteps of XAU / USD and XAG / USD.
- Concerns about the vaccine’s effectiveness against new COVID-19 strains and comments from Fed Chairman Powell fueled a flight to safe havens other than precious metals.
- XAU / EUR found strong support at the June 1st high, the previous resistance that became support at € 1,567.
Gold (XAU / EUR) is sliding against the euro for the day and is trading at € 1,568 at the time of writing in the New York session. Risk-free sentiment in the financial markets led to a flight to safe investments. In the case of the XAU / EUR spot, the common currency has the upper hand, climbing 0.83% against the non-yielding metal.
Comments from a pharmaceutical company CEO on the vaccine’s effectiveness against new strains of coronavirus weighed on market sentiment along with restrictive comments from Federal Reserve Chairman Jerome Powell favoring the greenback at the expense of precious metals.
However, XAU / USD falls 0.55% in the precious metals segment, while silver (XAG / USD) plunges 0.08% over the course of the day.
XAU / EUR Price Forecast: Technical Outlook
The XAU / EUR daily chart shows the upward trend in gold as long as the daily moving averages (DMA) are below the spot price with an upward slope. Additionally, it’s important to note that at the time of going to press, the high previous price level from June 1 that turned into a support was $ 1,567, the 200 DMA was hovering at $ 1,515.
On the flip side, if the June 1st support holds at € 1,567 it would help the gold bulls push the price higher with the € 1,600 number being the first area of resistance. Breaking the latter would reveal key supply areas such as the November 18 low that turned into resistance at € 1,632, followed by the YTD high at € 1,654.