Gold is consolidating in the range of $1,803-1,826 and is not yet able to extend the upward trend. In the medium term, a rising trade channel remains in place with a target of $1,838-1,840.
The weak dollar factor may well be supporting gold prices, but the market really has no need a safe asset right now. Risk sentiment is more than positive at the moment, so safe haven assets do not enjoy strong demand.
That said, interest in gold could be more pronounced in H2 than at the beginning of this year, given that the V-shaped economic recovery is nowhere to be seen amid sluggish growth rates of global economies.
It will be interesting to see how prices for precious metals – first and foremost, gold – behave as global economies start to scale back the unprecedented amount of stimulus that has been deployed to combat the effects of the pandemic. It cannot be ruled out that fiat currencies will lose weight – and this is an excellent reason for gold prices to go up.