Gold prices rose to a one-week high of $1,990 on Monday, up by almost 1%, as the US dollar continued to weaken. XAU/USD saw a positive tone and looked to test the $2,000 area, which could trigger further gains if there is a daily close above it. The rise in gold prices came after a negative opening due to the unexpected production cut by OPEC+. However, it stabilized on European hours and started moving higher during the American session.
The yellow metal gained momentum as US yields fell and risk appetite decreased. The US 10-year yield fell to 3.40%, while the US Dollar Index was down by 0.45% and hovered around 102.15. If XAU/USD fails to break above the $2,000 area, it could trigger a bearish correction. The upcoming economic calendar, including the ADP Private Employment and ISM Service PMI on Wednesday and the official employment report on Friday, could result in large price swings.
Investors are keeping an eye on gold prices as it is considered a safe haven asset during economic uncertainty. The rise in gold prices comes as concerns over the coronavirus pandemic and geopolitical tensions continue to weigh on global markets. The positive tone in XAU/USD could continue to trigger more gains as the US dollar weakens and risk appetite remains low.
