• Risk-on mood/US-China trade optimism continues to dampen safe-haven demand.
• Surging US bond yields/a modest USD bounce further add to the bearish pressure.
• Technical selling below March/April lows intensifies the downward momentum.
Gold remained heavily offered through the early North-American session on Tuesday and tumbled to 3-1/2 month lows, or fresh YTD lows around the $1274 region in the last hour.
A fresh wave of global risk-on trade, fueled by easing concerns over a global slowdown and optimism over a possible US-China trade deal, continued dampening the precious metal's perceived safe-haven demand and kept exerting downward pressure for the fourth consecutive session.
This coupled with a goodish pickup in the US Treasury bond yields further collaborated towards driving flows away from the non-yielding yellow metal, taking along short-term trading stops being placed near March/April swing lows support near the $1281 horizontal zone.
Hence, the latest leg of a sudden fall over the past couple of hours could further be attributed to a follow-through technical selling, with a modest US Dollar uptick, despite disappointing US data, further aggravating the selling pressure surrounding the dollar-denominated commodity.
Looking at the technical picture, acceptance below 100-day SMA for the first time since mid-Nov. 2018, and a subsequent break below a key support now opens the room for further depreciating move, albeit oversold conditions on hourly charts might help limit deeper losses, at least for the time being.
Technical levels to watch
|Today last price||1276.3|
|Today Daily Change||-10.48|
|Today Daily Change %||-0.81|
|Today daily open||1286.78|
|Previous Daily High||1292.05|
|Previous Daily Low||1271.1|
|Previous Weekly High||1310.7|
|Previous Weekly Low||1288.7|
|Previous Monthly High||1327.8|
|Previous Monthly Low||1280.1|
|Daily Fibonacci 38.2%||1279.1|
|Daily Fibonacci 61.8%||1284.05|
|Daily Pivot Point S1||1274.57|
|Daily Pivot Point S2||1262.36|
|Daily Pivot Point S3||1253.62|
|Daily Pivot Point R1||1295.52|
|Daily Pivot Point R2||1304.26|
|Daily Pivot Point R3||1316.47|
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