- Gold fluctuates in the New York session amid the uncertainty of midterm elections in the United States.
- US Treasury yields are rising, underpinning the US Dollar, which is up more than 0.50% against most G8 peers.
- Gold Price Analysis: Testing the 100-day EMA, which, once broken, would shift the bias to neutral-upwards as buyers are in control.
Gold price is trading in the red, unable to crack the key resistance level at around $1716, while US Treasury yields edge higher, underpinning the American Dollar, which per the US Dollar Index, tumbled below 110.000 on Tuesday. Factors like the United States midterm elections grabbed the spotlight, with a tighter-than-expected race weighing on the market mood. At the time of typing, the XAUUSD is trading at $1711.50, fluctuating.
Gold remains trendless around $1710 awaiting US midterm elections results and CPI
US equities are set to open lower, as shown by the futures market. A close race between the Republicans and Democrats turned sentiment sour, as polls suggest that the former might regain control of the US House while the Democrats would keep control of the US Senate. That said, the US Treasury yields rallied, led by the 10-year rising two basis points, at 4.155%, a tailwind for the precious metals space.
Additionally, the US 10-year real yield, which is the yield of the 10-year bond minus inflation expectations for the same time horizon, sits at 1.70%, capping the Gold rally on Tuesday. Meanwhile, the US Dollar Index, a gauge of the bucks’ value vs. a basket of peers, is snapping three days of consecutive losses, up by 0.54% at 110.220.
In the last week, the World Gould Council reported that central banks bought 400 tonnes of Gold in the third quarter, which according to last year’s data, was an increase of 300%, and it was the largest quantity of Gold bought since 2000.
That said, expectations for Gold resuming the uptrend lie in the hands of the Federal Reserve. Ahead of the week, the United States inflation report for October would keep investors on their toes as they assess the Fed-s next move. A US inflation jump wouldn’t deter Fed policymakers from tightening aggressively.
So if inflation moderates, that could be a tailwind for XAUUSD, which could benefit from “parked” US Treasury yields.
Gold Price Analysis: Technical outlook
Following Tuesday’s rally, which broke an eight-month-old downslope resistance trendline, the XAUUSD faces solid resistance at the 100-day Exponential Moving Average (EMA) at $1715.91. It should be said that Gold made a base at around the year-to-date lows of around $1614-$1617, and that zone was tested three times, with USD buyers unable to crack the $1600 figure. Therefore, a test of the August 25 daily high at $1765.48 is likely to happen, but XAU buyers need to clear the 100-day EMA.
Once done, the XAUUSD next resistance would be the August 22 daily low-turned-resistance at $1727.90, followed by the psychological $1750.
|Today last price||1711.75|
|Today Daily Change||-0.36|
|Today Daily Change %||-0.02|
|Today daily open||1712.11|
|Previous Daily High||1716.95|
|Previous Daily Low||1664.76|
|Previous Weekly High||1682.49|
|Previous Weekly Low||1616.69|
|Previous Monthly High||1729.58|
|Previous Monthly Low||1617.35|
|Daily Fibonacci 38.2%||1697.01|
|Daily Fibonacci 61.8%||1684.7|
|Daily Pivot Point S1||1678.93|
|Daily Pivot Point S2||1645.75|
|Daily Pivot Point S3||1626.74|
|Daily Pivot Point R1||1731.12|
|Daily Pivot Point R2||1750.13|
|Daily Pivot Point R3||1783.31|
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.