- Gold prices dropped more than $50 from the daily high.
- XAU/USD now up modestly after a sharp correction.
- US dollar remains strong, US yields limit upside in gold.
Gold prices experience a sharp correction from the peak of $1974 to the $1920 area. It is now approaching $1940. Volatility remains at extreme levels in metals.
Equity prices are holding onto sharp losses across the globe amid the escalation of the Ukraine conflict. Russian troops invaded Ukraine on Thursday and triggered a rally in commodity prices, including gold.
During the last hours, US yields moved toward daily highs supporting the correction in gold prices.
Above the $1965 area, gold lost momentum, and after some stabilization near $1960, XAU/USD corrected quickly to as low as $1912. A break lower could trigger a deeper pullback. The following support stands at $1890.
On the upside, the immediate resistance is located at $1940; and a break higher could easily send XAU/UD to $1950. If the rally continues, a consolidation above $1965 should keep the road clear for $2000.
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Technical levels
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