Gold extends a gradual ascent on Wednesday but the dynamics still looks unsustainable. This is not surprising, considering a widespread investor optimism over trade talks in Beijing and arrangements in Congress to avoid another shutdown. The bullion stays above the $1,300 psychological support but fails to make a sustained break above $1,315.
The dollar saw the biggest one-day losses in nearly two weeks yesterday, which partially supported the precious metal. Besides, the downside pressure on the bullion is limited as some investors remain cautious despite the growing optimism on US-China trade relations. The lingering concerns over the global growth that took a back seat for now, could reemerge at any moment and lift demand for safe-haven gold. This also helps the metal to stay afloat.
In the short term, the prices will likely remain in a familiar range, though short-lived spikes could take place as well. The risk of losing the $1,300 handle is limited but the chance that gold will make a decisive break above $1,315 is not strong either.