Gold Price Forecast: XAU/USD remains capped below the $1,680 resistance area

• Gold picks up again, but it remains unable to breach $1,680.
• The positive market mood is weighing on the safe-haven dollar.
• Rumors that Chima would be about to relax its Zero-COVID policy have boosted optimism.
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Gold futures have bounced up from $1,665 on Monday’s early European session appreciating on the back of US dollar weakness in a risk-on session, although it seems unable to find acceptance above $1,680 so far.

Precious metals appreciate as market sentiment improves

Precious metals have opened the week on a moderately bid tone, favored by a positive mood. Market rumors pointing out to a review of COVID-19 restrictions in China have improved investors’ sentiment on Monday, curbing demand for the safe-haven USD.

The comments by the Chinese National Health Commission, which has reiterated the Government’s commitment to the Zero-COVID policy and warned about the possibility of severe restrictions ahead, as the winter flu season approaches have tempered appetite for risk but have not altered the market mood, which remains moderately positive, with the greenback losing ground against a basket of the most traded currencies.

In absence of first-tier macroeconomic releases, the positive Friday’s Non-Farm Payrolls report is still driving market sentiment on Monday. Furthermore, the Eurozone Sentix survey has recorded an improvement in investors’ sentiment in November and has contributed to underpin appetite for risk.

Technical levels to watch