On Thursday, it was a bullish tale as sweeping U.S. sanctions on Russia triggered demand for the precious yellow metal.
The Biden administration targeted Russia with extensive sanctions, punishing Moscow for its interference in the 2020 U.S. election, its SolarWinds cyberattack and its ongoing occupation and “severe human rights abuses” in Crimea.
The announcement is one of a series of dramatic foreign policy steps that President Joe Biden has taken this week.
He decided to withdraw all troops from Afghanistan and send an unofficial delegation to Taiwan to express support for its democracy and security.
Before Thursday, the last time gold prices reacted to the ‘geopolitical situation’ was during the January 2020 assassination of Qasem Soleimani, Iran’s top general, who was killed in a U.S. strike ordered by Biden’s predecessor Donald Trump.
The stronger US dollar displayed on Thursday surprisingly did not weigh on spot gold, as it usually would.
The US Dollar Index, which measures the greenback strength against a basket of currencies, rebounded from 91.45, last at 91.67 (as of writing).
The target reached $1,760-65, time now to re-evaluate and sit neutrally in the short-term.