Gold Price Analysis: XAU/USD drops further to $1770 ahead of critical support
Gold dropped further during the American session and bottomed at $1769, the lowest level since last Friday. The metal erased weekly gains and is back below $1780 as US yields keep rising.
The US 10-year yield stands at 1.479%, a new one-year high. At the same time, stocks in Wall Street turned negative. The Dow Jones is falling by 0.35% and the Nasdaq 1.20%.
The decline in gold has been limited so far on the back of a mixed US dollar. The greenback is down versus main European currencies and up against the yen. Better-than-expected US economic data did not help the greenback.
Why tech is giving me jeepers – watch out, gold
Powell testimony is over, with markets rejoicing the promise of still accomodative Fed. Value keeps surging over growth, and regardless of yesterday‘s great performance, tech has a vulnerable feel to it –" semiconductors lead higher, fine, but communications didn‘t confirm, and the healthcare-biotech dynamic isn‘t painting an outperformance picture either. Real estate isn‘t taking as strong a cue while consumer discretionaries recovery could also be stronger. Thus far though, no need to think about taking losses to optimize your gains elsewhere.
Just as I wrote yesterday:
(…) the financials benefiting from the greater spread, won‘t save the day, as the key chart to watch now is technology and also healthcare. … The sectoral outlook remains mixed, even as value continues greatly outperforming growth this month. … Long-term Treasuries are starting to hold greater sway over the stock market fate now, too. The dollar‘s woes thus far continue playing out largely in the background.
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.