Gold has been trading marginally lower at $1,789.10/oz on Thursday, April 21 after bouncing back to a two-month high of $1,798.40. The price action could still hit $1,800, as the external news flow still looks upbeat.
Recent pandemic-induced developments have played into the hands of gold as a safe haven asset. This refers, first and foremost, to rocketing numbers of Covid cases in India and Japan. Investors have been piling into defensive assets, and gold provides the ideal hedge.
Additional support for gold is nothing out of the ordinary, including local US dollar weakness, as a result of which the precious metal invariably moves in inverse correlation.