XAU / USD remains stable near six-day highs just below the $ 1,920 level

• Gold gains traction for the third day in a row on Wednesday.
• The selling tone around the USD offers support for gold prices.
• Concerns about a sharp increase in COVID-19 cases offer additional support.

The prices of the oro move with a positive bias during the first half of the European session on Wednesday, hitting new six-day highs around the $ 1,923 region in the last hour, although it lacks a solid continuation.

Precious metal has gained traction for the third day in a row on Wednesday and has finally broken its four-day range. The prevailing selling bias around the US dollar has been considered one of the key factors that have benefited gold prices, denominated in dollars.

US President Donald Trump raised hopes for a advance on the stimulus package and he said he was willing to accept a large aid bill despite opposition from his own Republican Party. In addition, the Speaker of the House of Representatives, Nancy Pelosi, said that the stimulus measures would be approved by Congress.

The prospect of a stimulus package before the US elections. caused US bonds to crash and raised benchmark 10-year yield to four-month highs. The lack of demand for public debt, in turn, has put strong downward pressure on the dollar.

Meanwhile, investors remain concerned that the second wave of coronavirus could lead to further lockdown measures and prove detrimental to the already fragile global economic recovery. Market concerns have offered some additional support to the safe-haven precious metal.

From a technical perspective, the XAU / USD is now looking to build on its momentum above a two-month-old downtrend line. With that said, it will still be prudent to wait for some solid continuation buying above the monthly highs, around the $ 1,933 region, before opening any new bullish positions.