Gold remains depressed near 2-week lows, around $1910 area
- A strong pickup in the USD demand exerted some pressure on the dollar-denominated commodity.
- A selloff in equity markets, tumbling US bond yields extended some support and helped limit losses.
- A sustained break below 50-DMA and the $1900 mark is needed to confirm near-term bearish bias.
Gold maintained its offered tone through the early North American session and was last seen trading near two-week lows, around the $1910-08 region.
The precious metal came under some renewed selling pressure on Tuesday and finally broke down of a three-day-old trading range. A strong pickup in the US dollar demand turned out to be one of the key factors that undermined the dollar-denominated commodity.
The greenback was back in demand in the wake of the prevalent selling bias around the European currencies. The British pound was weighed down by the likelihood of a no-deal Brexit. The ECB's concerns over the exchange rate level kept the euro bulls on the defensive.
However, a sharp turnaround in the global risk sentiment – as depicted by a selloff in the equity markets – benefitted the precious metal's safe-haven status. The anti-risk flow was evident from a steep decline in the US Treasury bond yields, which extended some additional support to the non-yielding yellow metal and helped limit deeper losses.
The commodity, so far, has managed to defend the 50-day SMA support, around the $1908 region. A subsequent fall below the $1900 mark might be seen as a fresh trigger for bearish traders and set the stage for the resumption of the recent sharp corrective slide from record highs, around the $2075 region, set on August 7.
Technical levels to watch
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
