Gold Price Analysis: US real yields suggest XAU/USD close to a major bottom

Omkar Godbole FXStreet Contributor

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US real yields look set to resume their broader decline.
Gold's pullback from the record high of $2,075 could soon run out of steam.
One analyst says ETF flows to determine the price trend.

Gold could be close to bottoming out and may soon resume the broader uptrend, as real or inflation-adjusted yields look set to dive deeper into the negative territory.

According to the chart tweeted by Crescat Capital Portfolio Manager Otavia Costa, the US five-year real or inflation-adjusted yield (inverted) has breached a trendline, marking an end of a minor consolidation and resumption of the slide from 0.5 to -1.41% seen in the five months to August.

As such, demand for gold, a store of value asset, could again spike. However, according to Kyle Rodda, Market Analyst at IG Australia, gold's next move depends on flows in and out of exchange-traded-funds (ETFs).

"Given the initial inflows and how sentiment can separate price from any notion of fundamentals, there could be more downside for gold from here," Rodda tweeted while adding that the yellow metal is a good long-term bet.

The yellow metal fell to a nearly five-month low of $1,764 per ounce, having peaked at a record price of $2,075 in August.

Technical levels

XAU/USD

Overview
Today last price	1778.28
Today Daily Change	1.71
Today Daily Change %	0.10
Today daily open	1776.57

Trends
Daily SMA20	1864.09
Daily SMA50	1882.81
Daily SMA100	1910.03
Daily SMA200	1799.86

Levels
Previous Daily High	1790
Previous Daily Low	1764.6
Previous Weekly High	1876.14
Previous Weekly Low	1774.4
Previous Monthly High	1965.58
Previous Monthly Low	1764.6
Daily Fibonacci 38.2%	1774.3
Daily Fibonacci 61.8%	1780.3
Daily Pivot Point S1	1764.11
Daily Pivot Point S2	1751.66
Daily Pivot Point S3	1738.71
Daily Pivot Point R1	1789.51
Daily Pivot Point R2	1802.46
Daily Pivot Point R3	1814.91

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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