The market is operating defensively on Thursday after the increase in COVID-19 cases. Stock markets are moving lower, but gold fails to translate that into profit because the dollar is also higher.
According to the latest update of the COVID-19 cases from Hopkins University, yesterday, 176 new cases of coronavirus were registered worldwide. It set a new record for daily diagnoses.
So far, the number of confirmed cases has risen to 8.3 million in 188 countries, and the number of deaths to 450,000 people.
The most affected country is the United States, which is registering significant increases. The US has recorded more than 2.1 million cases and almost 118,000 deaths. Brazil follows with more than 955 thousand cases and 46 thousand deaths.
On the other hand, the Bank of England and the National Bank of Switzerland announced monetary policies. In London, the central bank decided to maintain its interest rates, although it increased its asset purchase program by £ 100bn.
Also, the Swiss National Bank left its monetary policy unchanged but stated that it expected GDP to contract 6% in 2020.
Dollar maintains its recovery
The dollar index gets benefits on the market’s risk aversion. It is trading higher for the third consecutive day, although the gains are not significant. The DXY has been testing the level of 97.35 for several sessions, without being able to break it.
Right now, the DXY is trading at 97.23, representing a 0.16% advance on the day. The chart is gaining bullish momentum in the medium term, and it is keeping gold lower.
The gold is trading lower Thursday with losses of around 0.30% on the day, after operating the 1721.80.
Although the XAU / USD is registering losses. The metal is moving horizontally and, for several days, has maintained a narrow range between 1,715 and 1,735.
Technically, the metal is being supported by the 50-day moving average line, which is currently at 1.715.