Gold Price Forecast: XAU/USD rebounds above $1800 from a five-month low as US yields tumble
- Gold prices trim daily losses as the dollar soars on risk aversion.
- US yields collapse amid fears of a recession.
- Silver also rebounds, down “just” 2.60%.
Metals rebounded during the American session, amid a collapse in US yields. The rally in Treasuries boosted gold that dragged silver to the upside. XAU/USD is hovering around $1,800/oz, far from the daily low.
Yields tumble helping gold that helps silver
US yields spiked to the downside. The US 10-year dropped to as low as 2.79%, the lowest since late May (earlier on Friday, it traded above 3.00%), while the 30-year tumbled to 3.02%.
Recession fears are softening Fed’s tightening expectations. The bond market on Friday is showing more concerns than the equity market. In Wall Street, the Dow Jones is falling by 0.56% and the Nasdaq by 0.49%.
The sharp slide in yields pushed gold back above $1,800, alleviating the bearish pressure. XAU/USD bottomed at $1,784, the lowest since late January. It is still down for the day and about to post the lowest weekly close in months. The area around the 2022 low at $1,780 is a critical support.
Silver also trimmed losses dragged to the upside by gold. XAG/USD bottomed at $19.38, level not seen since July 2020 and it is trading at $19.75, down 2.60%. Price is under the 200-week Simple Moving average for the first time since May 2020.
Technical levels
Author
Matías Salord
FXStreet
Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.
