Gold plummets to near 2-month lows, around $1460

US-China trade optimism continues to weigh on the commodity’s safe-haven status.
Rising US bond yields fueled the ongoing USD bullish run and add to the selling bias.
The overnight breakthrough neckline support further aggravates the bearish slide.

Haresh Menghani FXStreet

Gold added to its recent losses and dropped to near two-month lows, around the $1460 region during the early European session on Tuesday.

A combination of forces kept exerting downward pressure for the third consecutive session on Tuesday - also marking its fourth day of a negative move in the previous five - and contributed to the precious metal's ongoing corrective slide from multi-year tops set on September 4.

Risk-on mood adds to the recent selling bias

Against the backdrop of growing optimism over a possible resolution of the prolonged US-China trade dispute, the prevalent risk-on mood was seen as one of the key factors weighing on traditional safe-haven assets and exerting some heavy pressure on the precious metal Gold.

Improving global risk was reinforced by a strong follow-through pickup in the US Treasury bond yields higher, which provided an additional boost to the ongoing US Dollar bullish run to two-year tops and further collaborated towards driving flows away from the non-yielding yellow metal.

Tuesday's downfall could also be attributed to some technical selling, especially after the previous session's decisive break below the $1483-80 horizontal zone - marking the neckline support of a bearish head and shoulders pattern formation on the daily chart.

Hence, a subsequent slide back towards testing a previous strong resistance, now turned support near the $1448-47 region, now looks a distinct possibility ahead of Tuesday's important release of the US ISM manufacturing PMI for September, due later during the early North-American session.

Technical levels to watch

XAU/USD

Overview
Today last price	1461.5
Today Daily Change	-11.17
Today Daily Change %	-0.76
Today daily open	1472.67

Trends
Daily SMA20	1506.86
Daily SMA50	1493.82
Daily SMA100	1425.28
Daily SMA200	1360.7

Levels
Previous Daily High	1500.36
Previous Daily Low	1464.61
Previous Weekly High	1535.42
Previous Weekly Low	1487.2
Previous Monthly High	1557.03
Previous Monthly Low	1464.61
Daily Fibonacci 38.2%	1478.27
Daily Fibonacci 61.8%	1486.7
Daily Pivot Point S1	1458.07
Daily Pivot Point S2	1443.46
Daily Pivot Point S3	1422.32
Daily Pivot Point R1	1493.82
Daily Pivot Point R2	1514.96
Daily Pivot Point R3	1529.57

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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