Gold Price Analysis: XAU/USD stays depressed below $1,800, eyes US Treasury yields


  • Gold prices fail to keep the bounce off $1,789.54, remains heavy near two-week low.
  • US Treasury yields refresh multi-month high, recall US dollar bulls.
  • Risk-on mood gain momentum with the American covid relief package eyed by March 08.
  • US Retail Sales, FOMC Minutes will decorate the calendar but risk catalysts remain as the key.

Gold remains on the back foot around $1,795, failing to defy the heaviest losses in two weeks, amid the initial Asian session on Wednesday. The yellow marks the five-day losing streak while keeping the previous day’s bearish move as the US 10-year Treasury yields back the US dollar’s strength and exerts additional downside pressure on the bullion at times when market optimism weighs on safe-havens.

No respite for bears…

The precious metal attacks the monthly low as a jump in the US bond yields, to the levels last seen during February 2020, signal an extra strength for the greenback, which in turn pleases the gold sellers.

Previously, improvement in the coronavirus (COVID-19) conditions and the jump in the covid vaccinations joined hopes of the US virus relief package to favor the bullion sellers. The downside move recently got the US dollar strength as the power fuel to direct the metal towards key supports.

The UK and Israel’s success in jabbing the vaccines gained support from receding virus infections. The US COVID-19 numbers are also declining off-late while the major vaccine producers stay ready to respect their delivery obligations. Even so, some of the Asia-Pacific countries, like Japan, Australia and New Zealand, battle the virus and keep the issue on the table for concern.

Elsewhere, America’s ex-President Donald Trump got acquitted for the Capitol Hill attacks, giving time for Congress to move on the much-awaited stimulus. Recent updates from CNN’s Manu Raju suggest that President Joe Biden’s covid relief plan is likely to be tested on the House floor by end of next week, and the chamber is preparing for final passage week of March 8 if Senate amends it.

Amid these plays, US 10-year Treasury yields grew over 11 basis points to close Tuesday’s North American trading session, the first in the week, at 1.311%. While the moves helped the US dollar index (DXY) to recover from the monthly low, Wall Street closed mixed.

Looking forward, gold traders will keep their eyes on the US Treasury yields for fresh impulse amid a light calendar in Asia. During the American session, the expected recovery in January’s Retail Sales needs support from FOMC minutes to keep the greenback bulls happy, which in turn can favor gold sellers.

Technical analysis

An ascending trend line from November 30, at $1,789 now, precedes the yearly bottom around $1,785 and the late-2020 low near $1,765 to challenge the yellow metal’s short-term downside. On the contrary, January’s low of $1,803 guard’s quote’s immediate upside while the convergence of 21-day SMA and January a six-week-old trend line, around $1,835, becomes the key hurdle.

Additional important levels

Overview
Today last price 1795.12
Today Daily Change -22.78
Today Daily Change % -1.25%
Today daily open 1817.9
 
Trends
Daily SMA20 1838.65
Daily SMA50 1858.33
Daily SMA100 1868.69
Daily SMA200 1857.97
 
Levels
Previous Daily High 1827.11
Previous Daily Low 1816.16
Previous Weekly High 1855.5
Previous Weekly Low 1807.86
Previous Monthly High 1959.42
Previous Monthly Low 1802.8
Daily Fibonacci 38.2% 1820.34
Daily Fibonacci 61.8% 1822.93
Daily Pivot Point S1 1813.67
Daily Pivot Point S2 1809.44
Daily Pivot Point S3 1802.72
Daily Pivot Point R1 1824.62
Daily Pivot Point R2 1831.34
Daily Pivot Point R3 1835.57

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Get Weekly Crypto trade ideas!  
Empower yourself with the best market insights

Join FXStreet Premium!    

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD retreats from 1.20 amid mixed US data

EUR/USD has retreated from its move toward 1.20 as US data is mixed. Building Permits and Housing Starts beat expectations but Consumer Sentiment missed with 86.5 points. Vaccine news is eyed.

EUR/USD News

GBP/USD battles 1.38 as US yields halt their falls

GBP/USD is trading around  1.38, off the highs as US Treasury yields are stabilizing after falling beforehand. US data is mixed. Sterling continues benefiting from Britain's vaccination campaign.

GBP/USD News

Stellar bulls on wrong side of uphill battle

XLM price has erected an ascending parallel channel on the 4-hour chart. A bounce from the setup’s lower trend line, although logical, seems unlikely. Stellar’s bear flag pattern on the 1-hour chart adds weight to the bearish outlook.

Read more

XAU/USD climbs to the highest level since Feb. 25, beyond $1,780

Gold gained strong follow-through traction for the second consecutive session on Friday. The USD struggled to capitalize on its attempted recovery and benefitted the commodity. Rebounding US bond yields, the risk-on mood did little to hinder the positive momentum.

Gold News

Gamestop waits for breakout signal, technical levels to watch

GameStop is struggling for relevance as COIN takes over! GME shares under pressure, down 6% on Thursday. GME is looking for a new CEO according to Reuters.

Read more

Forex MAJORS

Cryptocurrencies

Signatures