Gold Opens The Week Positive, But Gains Limited Ahead Of Central Banks

Precious Metals opened the week with gains as investors are on a wait-and-see mode ahead of central banks announcements this week.

Gold, Silver, Copper, and Palladium are up on the day, while the Dollar index is testing critical support.

The dollar index is 0.10% negative on the day as the unit is now trading at 2-week lows around the 96.40 crucial support.

Global risk sentiment as a catalyst

Risk sentiment remains on the table as investors now think that a dovish Fed will fuel stocks market. However, a weak dollar is underpinning gold and other commodities.

In any case, experts are in wait-and-see mode ahead of the series of central banks’ monetary policy announcements this week.

From the Federal Reserve taking the lights on Wednesday, until the Swiss National Bank and the Bank of England having the baton on Thursday.

All banks are expected to take dovish stances with the Federal Reserve keeping the focus as it will release its new economic projections.

“The Fed’s interest rate and monetary policy decisions on Wednesday, as well as the Federal Open Market Committee’s new economic projections, will probably exert the most influence on gold prices this week,” FX Empire analyst James Hyerczyk highlighted in a recent article.

Policymakers could turn more dovish in the next days. It would be supportive for gold and other precious metals.

In this framework, commodities started the day with declines, but gold and silver recovered losses, and now they are posting gains.

Gold extends gains

Gold is trading positive on Monday amid a weak dollar. Currently, XAU/USD is posting 0.26% gains so far today as it is pricing at 1,305.

The pair is now ready for a new test of the 20-day moving average at 1,308. Remember that this line rejected gold twice last week.

With a break above the mentioned moving average, gold will have open doors to the 1,320 area, where it would be able to build up another bullish leg. Then, check 1,330 and 1,345 as the new frontiers.

To the downside, a failure at 1,300 will send XAU/USD down to 1,290, where the next important buying area is. Below there, 1,280 is the critical level to watch.

Silver opens the week with gains

Silver recovered initial losses on Monday to regain the 15.30 area and to trade as high as 15.40. A weak dollar and a positive correlation with Gold are the main factors contributing to these movements.

XAG/USD is currently trading 0.44% positive on the day at 15.35. On the middle term, silver is well supported by the 200-day moving average level at 15.12and by the 15.00 support area.

To the upside, 15.50 is the next resistance with 20 and 50 days moving averages between 15.50 and 15.60 levels.

Copper reclaims the 2.9000 area

Copper is trading positive on Monday as it is extending its Friday’s pullback from 2.85.

XUC/USD is now trading 0.63% positive on the day at 1.9170. The pair is trading sideways between 2.8550 and 2.9270.

Palladium approaches to its all-time highs

XPD/USD is trading positive for the sixth day in a row as palladium is approaching its all-time price against the dollar at 1,570.

The pair is now pricing at 1,561, 0.46% positive on the day.