After hitting an eight-month low on Monday, the gold market finally did not fall further and is now back around $1730 an ounce.

The performance of Treasury yields and the dollar index put gold under heavy pressure.

But expectations of an imminent $1.9 trillion stimulus package for Biden have provided some support for gold.

Analysts at Heraeus Precious Metals say they are still bullish on gold in the long run, but a sustained recovery in the short-term dollar will be a big problem.

"compared with other precious metals, gold looks rather flat, but its low volatility is still the reason to allocate gold in the portfolio."

The recovery in the global economy this year, especially in China and India, the two largest gold demand countries, will lead to strong consumer demand for gold, supporting gold, but at the same time, the rising dollar is another threat, the agency said.

For the dollar, the previous market bearish is a problem to pay attention to.

"when the market position is one-sided, the trend may be nearing the end and the reversal will come soon. For now, loose fiscal and monetary policy has been counted as gold. Any sign of tightening will push up the dollar, which is bad for gold. "

Improved U.S. economic data combined with problems in the European economy boosted the dollar's performance, according to T.D. Securities.

"if the current data continues, the dollar will be further supported by the slow distribution of vaccines in the eurozone and increasing warnings from the ECB about the risks of austerity."