Gold Price Analysis: XAU/USD bears eye $1,670 as Treasury yields rebound – Confluence Detector

Anil Panchal FXStreet

Gold recently refreshed intraday low to $1,706.68, before bouncing off to $1,708, during early Thursday. The yellow metal dropped to the fresh low since June 2020 the previous day as market sentiment dwindled amid a fresh run-up in the Treasury yields that propelled the US dollar and disappointing commodities.

Behind the moves could be the hopes of a heavy inflow of funds due to the recent UK budget and upcoming US stimulus. Also on the same line could be the central bankers’ efforts to tame the bond bears.

The risk-off moves gained extra support during Asia amid chatters of progress in the US covid relief package and an abrupt off in the US House amid a rumored plot to attack Capitol Hill.

As a result, S&P 500 Futures join stocks in Asia-Pacific to mark losses whereas the US 10-year Treasury yields remain firmly directed towards 1.50%.

Moving on, Fed Chair Jerome Powell’s speech at 17:05 will be the key to confirm the reflation fears and hence will be watched closely ahead of Friday’s NFP.

Gold: Key levels to watch

The Technical Confluences Indicator suggests the uphill battle for the gold prices unless providing a clear break above $1,743 as multiple hurdles to the north joins US dollar strength to favor gold sellers.

Among them, 38.2% Fibonacci retracement on daily (1D) and the previous high on the four-hour (4H) and hourly (1H) formations join the upper band of the Bollinger on the 15-minute chart to highlight $1,718 as an immediate key hurdle.

Following that, 61.8% Fibonacci retracement of 1D and SMA10 on 4H offers $1,729-30 as an extra resistance before fueling the bullion to the key $1,743 upside barrier comprising 23.6% Fibonacci retracement on a weekly (1W) and previous high on 1D.

Meanwhile, the $1,700 round-figure can tease the gold bears before directing them to the Pivot Point’s first support, S1, on the W1 near $1,693.

Though, the bullion’s further downside will witness strong support of around $1,670, including Pivot Point S1 for the monthly (1Month) formation.

Here is how it looks on the tool

About Technical Confluences Detector

The TCD (Technical Confluences Detector) is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

AUD/USD holds above 0.6950 as bullish USD caps gains

AUD/USD edges lower during the Asian session on Tuesday, stalling a two-day recovery move from a two-month low, touched last week. An extended rout in the fixed income market keeps US bond yields elevated near multi-year highs. This, along with geopolitical uncertainties, helps the US Dollar retain its bullish tone despite receding October Fed hike bets. However, expectations for another RBA rate hike this month could act as a tailwind for the Aussie.

USD/JPY remains confined in a range; 158.00 holds the key

USD/JPY extends its consolidative move during the Asian session on Tuesday, trading below 158.00 amid diverging forces. Hawkish BoJ expectations support the Japanese Yen amid looming intervention risks. Meanwhile, geopolitical uncertainty and elevated US bond yields keep the US Dollar near its YTD high despite receding October Fed hike bets. This, in turn, holds back traders from placing aggressive directional bets.

$4,100: For how long can Gold defend that level?

Gold resumes the recent downtrend, approaching $4,100 early Tuesday. The US Dollar consolidates near 17-month highs amid high Treasury yields and a rebound in oil prices. From a short-term technical view, Gold’s path of least resistance appears to be down.

Ethereum: BitMine scoops extra ETH tokens following Q3 outperformance

Ethereum (ETH) treasury firm BitMine Immersion continued its buying streak of the top altcoin last week. The firm acquired 15,112 ETH, lifting its holdings to 6.016 million ETH, representing 4.9% of ETH's circulating supply and worth $16.16 billion at the time of writing. That brings the company roughly 98.5% closer to acquiring 5% of ETH's supply, a goal it tags "Alchemy of 5%."

The scarcity trade is gaining momentum – The biggest commodity moves may still be ahead

Something extraordinary is happening across global Commodity markets. Oil is above $100. Diesel has reached record prices. Copper has broken records. Global food prices are rising again. China is restricting fuel exports. Governments are releasing emergency reserves.

Eurozone inflation just hit 3.8%, its highest in three years. This chart shows why the ECB can’t simply hike its way out

The ECB would normally have a relatively straightforward answer to inflation running almost twice its target: raise interest rates. But these are not normal circumstances. This time, the bond market is already doing part of the tightening for it, leaving the ECB facing an increasingly difficult dilemma.