• Gold bears are putting pressure on the bulls at a critical area on the daily chart.
  • Gold prices are under pressure despite rising recession odds.

At $1,806, the gold price is lower by some 0.66% after falling from a high of $ $1,825.21 to a session low of $1,802.77, breaking out of its consolidation range. Traders have moved out of the yellow metal even as stocks, the dollar and bond yields fell.

The drop came even as investors moved out of equities, with the S&P 500 Index last seen down 1.25% on what has been a mixed week in sentiment and data. The highlights of Thursday's data schedule were a faster monthly pace of growth in the PCE price index, steady personal income expansion, and slower spending growth. Personal income was up 0.5% in May, right on expectations after a 0.5% gain in the previous month. 

After an adjustment for a 0.6% increase in the PCE price index, real personal consumption was down 0.4% in May after a 0.3% increase in April. Core PCE prices rose by 0.3% for the fourth straight month, slowing the year-over-year rate to 4.7% from 4.9% in the previous month. Gold briefly bounced after the US data but quickly moved back into the tight range it has been in for the past few sessions.

In other data, the Chicago PMI fell to 56.4 in June from 60.3 in May. Other manufacturing data already released have suggested slower growth or outright contraction. The ISM's national index will be released on Friday. Initial jobless claims decreased by 2,000 to 231,000 in the week ended June 25, but the four-week moving average rose by 7,250 to 231,750, continuing the string of gains.

Meanwhile, the US dollar also fell, making gold more affordable for international buyers, with the DXY dropping to 104.645 the low of the day so far. US bond yields fell sharply, which is offering a lifeline to the precious metal since it pays no interest. The yield on the US 10-year note was last seen down at 2.980%, near its three-week low made earlier at 2.97%

''Gold prices are under pressure despite rising recession odds, in contrast to recent price action pointing to safe-haven flows supporting the yellow metal,'' analysts at TD Securities said.

''In fact, gold prices have disconnected altogether from market pricing for Fed hikes over the past month, and have instead grown their relationship with the USD, pointing to a smaller magnitude of idiosyncratic flows for the yellow metal.

''While the bias remains to the downside in gold, participants will need a catalyst to shake out the complacent longs in precious metals.''

Gold technical analysis

The bears have moved in on a critical area that could be broken that will give way to the potential of a deeper run towards $1,720. 

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.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

GBP/USD pokes weekly resistance line around 1.2100

GBP/USD pokes weekly resistance line around 1.2100

GBP/USD picks up bids to extend the previous day’s recovery to 1.2100 during Wednesday’s Asian session. In doing so, the Cable pair approaches a one-week-old resistance line while also portraying the third bounce off the 50% Fibonacci retracement level of July-August advances.

GBP/USD News

EUR/USD: 1.0100 remains in sight below 21 DMA, EU GDP, Fed minutes awaited

EUR/USD: 1.0100 remains in sight below 21 DMA, EU GDP, Fed minutes awaited

EUR/USD consolidates the previous rebound amid a cautiously optimistic mood. US dollar takes a breather ahead of Fed minutes, the euro awaits Eurozone GDP. The shared currency remains weighed down by recession fears and gas crises.

EUR/USD News

Gold bears are lurking below $1,785

Gold bears are lurking below $1,785

Gold is flat on the day trading at around $1,776.50 and sticking to a tight range of between $1,773.91 to a high of $1,776.85. The yellow metal fell due to rising Treasury yields weighed on investor appetite. A slightly stronger US dollar was also a headwind for investor demand. 

Gold News

Dogecoin price to provide a buying opportunity before exploding 35%

Dogecoin price to provide a buying opportunity before exploding 35%

Dogecoin price sees a slow decline in bullish momentum as a major hurdle puts an end to its explosive move. A pullback is emerging for DOGE and is likely an opportunity that will allow bulls to recuperate and prepare for the next rally.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures