Gold Remains in a Narrow Range Above 1,900

Gold is trading higher on Tuesday after investors are watching headlines about the possible approval of the US fiscal stimulus package. However, caution persists, and gold remains within the narrow range in which it has moved in recent days.

On Tuesday, the Democratic leader said that her party and the White House had moved closer together on a possible agreement on the stimulus package. She hoped that the conversation with Steven Mnuchin, a government delegate, would be fruitful by the end of the day.

Also, Nancy Pelosi, the Speaker of the house of representatives, lowered the tension in the market by the deadline that she gave a couple of days ago. 

In that environment, gold is trading in a range between 1,890 and 1,915 just like in the last week. 

The XAU/USD is up 0.32% on the day by moving to 1.910.

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The gold outlook looks bullish

According to ANZ, the approval of a stimulus package would give gold wings to reach $2,300 per ounce by the end of the year. 

Strategists Daniel Hynes and Soni Kumari wrote in their latest commodity report that the approval of an aid package in the United States would be the trigger for the rise in prices.

The future of gold looks bullish due to the increase in economic concerns within the environment of the COVID-19 pandemic. Besides, the positions of central banks to promote aid and low rate policies will give wings to the metal.

The strategists think that the price of gold will reach $2,300 early next year.

Silver advances towards 25.00

The socio-political environment in the United States has also boosted silver. On Tuesday, the XAG/USD posted its second day of gains and tested the area of ​​$25.00 per ounce.

Right now, the XAG/USD is being priced at 24.74, which is up 1.45% on the day.

The US dollar index dropped below 93.50 and is heading towards the nearest support level at 93.00. If the dollar gets to the test of the 93 levels, silver will acquire more support. The weaker dollar makes it cheaper for buyers of silver who hold other currencies. 

Gold failed to develop upside momentum; however, it maintains solid chances to continue its upward move. 

Gold/silver ratio decreased below the support at the 20 EMA at 77.95. It is bullish for the white metal. The next support level for gold/silver ratio stands at the recent lows near 75.50. A movement towards this level will be a bullish development for silver.