Gold (XAU/USD) plunged below $1,700 on Thursday, as Treasury yields jumped after Chair Powell failed to provide a forceful pushback against the recent surge in yields. The yellow metal is set to fall towards the $1,660 region, according to strategists at TD Securities.
“Gold is looking for a bottom but is only likely to reach it when the US central bank acts to convincingly prevent rates from moving higher. After all, real rates will likely remain negative as the Fed attempts to engineer an inflation overshoot, and there is a growing risk that massive and growing public debt may be monetized.”
“XAU/USD can soon drop towards $1,660 amid a technical breakdown as trend followers add to their shorts. A stronger USD, and physical traders using gold to raise dollars in order to capitalize on higher yields, also helped to drive capital out of the metal.”
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.