Gold Price News and Forecast: XAU/USD falls to nine-month low after breaking key supports


Gold Price Forecast: Downside appears more compelling for XAU/USD, NFP in focus

Gold (XAU/USD) holds the lower ground below the $1700 level, as Fed Chair Jerome Powell’s dismissal of the bond market turmoil triggered a fresh sell-off in the Treasuries, which drove the yields higher. US stocks tumbled on concerns about the growth and inflation forecasts, which boosted the safe-haven US dollar while knocking-off gold below $1700. Investors remain unnerved, as they believe that the rallying yields likely signals overheating of the economy. The benchmark 10-year Treasury yields rallied 4% and recaptured 1.50% on Powell’s comments while the US dollar index rose to three-month highs above 91.50.

Heading into the critical US NFP release, gold looks vulnerable, as the dollar holds firmer in tandem with the yields. If the headline NFP figures disappoint, the risk-off action in the global equities could intensify, bolstering the haven demand for the greenback, which could cause more pain for gold. Read more...

Gold

XAU/USD outlook: Gold falls to nine-month low after breaking key supports

Spot gold broke through $1700 handle and fell to nine-month low on Friday, extending larger downtrend after remarks from Fed’s Chair Jerome Powell lifted dollar and bond yields. The yellow metal is on track for the third straight weekly decline and close below pivotal Fibo support at $1725 (38.2% of $1160/$2074) that would add to strong bearish signals, generated on previous week’s close below the base of thick weekly Ichimoku cloud.

Strong fall in safe haven demand on rising optimism that the economic recovery will pick up, following declining number of new coronavirus cases and vaccine rollout, deflates gold price. Read more...

Chart

Gold price analysis: XAU/USD has a weaker selling and starts bullish at 1690

Gold has continuously fallen down for a week, from $1760/oz to $1685/oz. Gold dropped because investors are encouraged by the speech of FED Chairman, Mr. Jerome Powell. In this speech, Powell asserted that inflation will increase when the economy recovers, but it is only temporary. He also warranted not to raise interest rates if inflation was not stable at 2% - 3% and the number of jobs created, is kept stable in the next quarter. The yield on US government bonds also increased after the speech on 4th March.

The yield curve of the United States increased strongly in February, showing a positive movement of the economy and optimis among investor. Therefore, cash flows from safe-haven assets to risky assets with higher profitability. Read more...

Gold

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