Futures for gold on Monday were swinging between gains and losses on the session to start a holiday-shortened week, the last stretch of trading in 2020.
Bullion has benefited over the year from economic uncertainties over the novel strain of coronavirus that causes the COVID-19 illness, but has been struggling to hold on to key levels near $1,900, with the rollout of experimental vaccines and remedies that have been rapidly authorized by governmental health bodies to tackle the pandemic.
Risk markets scored a boost on Monday after President Trump signed a sweeping pandemic-aid bill into law over the weekend, ending a standoff with Congress and paving the way for millions of Americans to get economic relief as the coronavirus pandemic surges across the country.
The legislation will see some $900 billion in coronavirus relief aid for workers and businesses and was seen as a support for gold prices because government spending is seen devaluing dollars.
However, much of the move in gold from COVID aid measures may have been priced into the metal, some experts said.
A current bout of weakness in greenback is expected to limit any slide in gold and silver. A slumping dollar tends to make assets priced in the commodity more appealing to buyers overseas.
The dollar was off 0.1% at 90.263, as measured by the ICE U.S. Dollar Index.
Gold for February delivery was trading off $1.20, or 0.1%, to reach $1,884.50, after posting a 0.3% decline and snapping a streak of three consecutive weekly gains, FactSet data show.
Some analysts attributed the unsteady trade in gold, despite the slump in the dollar on the day, to technical resistance.
“However, after having a pop at the $1,900/oz level, gold pulled back as it was unable to overcome strong resistance in that area,” wrote Raffi Boyadjian, senior investment analyst at XM, in a daily research note.
Silver for March delivery meanwhile, which trades at times as both an industrial and a precious metal, was getting some lift from hope of a better economic backdrop from the passage of relief aid. Silver prices were adding 63 cents, or 2.4%, to trade $26.525 an ounce, following a weekly slump of 0.3% on Thursday.
Metals trading last week settled an hour earlier on Thursday, at 12:30 p.m. Eastern, and remained closed in observance of Christmas on Friday. Markets will be closed this Friday in observance of New Year’s Day.