The price of gold was slightly higher on Thursday after recovering from an almost three-week low on the previous day. The bullion was somehow supported by the news that the dollar paused from a rally before the ECB meeting.
U.S. gold futures advanced as high as 0.2 percent to finish trading at $1,281.20 per ounce for its December delivery. Meanwhile, spot gold was also higher by 0.2 percent to settle at $1,279.96 per ounce after closing on the negative territory the last session at $1,270.63 per ounce, its lowest level since October 6.
According to Wang Tao, a technical analyst at Reuters, there are possibilities that spot gold will rise to a resistance at $1,283 an ounce. This is considered as a break above that may head to a gain of $1,289.
OANDA’s senior market analyst Jeffrey Halley said on the same day that the yellow metal has been undermined by the decline of U.S. Treasury yields overnight and the sluggishness of the greenback before the European Central Bank (ECB) meeting.
It is already given that the bullion will benefit from a weaker dollar because it would make it cheaper for holders outside the United States, which will further strengthen the demand.
Last Tuesday, U.S. President Donald Trump had a meeting with the Senate Republicans and polled on whether they would choose professor of economics at Stanford University John Taylor or Fed Governor Jerome Powell as the new chief of the U.S. central bank.
National Australia Bank’s economist John Sharma said a lot of senators prefer Taylor because of his hawkish stance on rate hikes. This might lift bond yields which can be bad for gold.