- The inverse correlation between gold and the US 10-year yield is currently at its strongest in 12 months.
- A convincing break above $1,300 could remain elusive if the yield extends the recent recovery rally.
The 90-day correlation coefficient between gold and the 10-year US Treasury yield currently stands at -0.798 – a level last seen in January 2018.
The negative number indicates an inverse relationship, that is, gold rises when the benchmark treasury yield drops and vice versa.
With the negative correlation strongest in 12 months, gold will likely have a tough time scaling the $1,300 mark, if the 10-year yield continues to rise.
It has already risen by 20 basis points in the last five days, which explains the signs of bullish exhaustion in gold near $1,300.
As of writing, the yellow metal is changing hands at $1,290 per Oz, while the 10-year treasury yield is trading at 2.74 percent.
Gold Technical Levels
Today Last Price: 1288.46
Today Daily change: 2.2e+2 pips
Today Daily change %: 0.168%
Today Daily Open: 1286.3
Previous Daily SMA20: 1271.77
Previous Daily SMA50: 1243.49
Previous Daily SMA100: 1227.63
Previous Daily SMA200: 1229.07
Previous Daily High: 1297.15
Previous Daily Low: 1286.25
Previous Weekly High: 1298.42
Previous Weekly Low: 1276.82
Previous Monthly High: 1284.7
Previous Monthly Low: 1221.39
Previous Daily Fibonacci 38.2%: 1290.41
Previous Daily Fibonacci 61.8%: 1292.99
Previous Daily Pivot Point S1: 1282.65
Previous Daily Pivot Point S2: 1279
Previous Daily Pivot Point S3: 1271.75
Previous Daily Pivot Point R1: 1293.55
Previous Daily Pivot Point R2: 1300.8
Previous Daily Pivot Point R3: 1304.45
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