Rising US yields have exacerbated gold’s decline, with downward pressure having gold testing key Fibonacci markers at 1,726 and 1,689. The 19.2% decline from August 2020’s 2075 peak places the yellow metal at oversold levels, with XAU/USD driven towards a test of a 1,660-1,670 support confluence zone, Benjamin Wong, Strategist at DBS Bank, reports.
“Gold ETF demand sprouted from September 2019 onwards, and back-testing that against an average line costing, such holdings are average costed around 1680 (hence the significance of the 1,660-1,670 confluence zone).”
“Both gold longs either on ETFs or futures positioning are reducing longs – hence, unless gold secures a sustained return over 1,760-1,765 (the May highs and a prior 50% Fibonacci marker) and the 200-day moving average at 1,859, the risks would be both ways until the bull reasserts its presence.”
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.