Gold bulls see the last dance on US election day amid caution trading

Gold extended its rebound into a third straight session on Monday, although remained below the $1900 mark undermined by falling US inflation expectations over the past two weeks, in absence of a new fiscal stimulus aid. XAU/USD bulls insist on US election day but the upside appears limited, FXStreet’s Dhwani Mehta briefs.

Key quotes

“Gold’s fate hinges on the outcome of the 2020 Presidential election. The presidential race narrows in six swing states, as Joe Biden continues to hold a narrow lead over Donald Trump in the final stretch on Tuesday. In the meantime, a jittery market mood combined with rising coronavirus concerns could likely keep the precious metal in a familiar trading range.”

“Recapturing the $1900 level is critical to unleashing more gains, with a test of the pattern target at $1910 due on the cards.”

“The 50 and 100-HMA bullish crossover adds credence to the bullish bias. The hourly Relative Strength Index (RSI) holds above the 50 level despite the latest leg down, leaving buyers hopeful.”

“Acceptance below the 21-HMA at $1891 could trigger a sharp drop towards $1884, almost where the upward-sloping 50-HMA coincides with the 100-HMA.”