- Wall Street gains traction, 10-year T-bond yields advance to fresh daily high.
- US Dollar Index consolidates daily losses near 94.90.
- XAU/USD loses more than $20 since the start of the week.
The selling pressure witnessed on the XAU/USD pair remains intact on Thursday as the higher risk appetite hurts the demand for traditional safe-havens in the NA session. At the moment, the troy ounce of the precious metal is down $4.5 on the day at $1247.50.
The T-bond yields, which show an inverse correlation with the XAU/USD pair, are looking to end the day in the positive territory after recording losses during the first half of the week. As of writing, the 10-year reference was up 0.7% on the day at 2.85%. Moreover, the improving market sentiment is also reflected upon the major equity indexes in the United States. Following a choppy start to the day, Wall Street gained traction and the Dow Jones Industrial Average and the S&P 500 were both up around 0.25%.
On the other hand, the US Dollar Index retraced its daily gains and dipped into the negative territory below the 95 handle amid disappointing growth figures. The monthly report released by the Bureau of Economic Analysis on Thursday revealed that the real-GDP is expected to expand by 2% in the first quarter of the year, less than the previous estimate and the market expectation of 2.2%.
Although the DXY looks to end the day with modest losses, a positive reading in tomorrow’s core-PCE price index data, the Fed’s preferred gauge of inflation, could allow the index to close the week on a positive note and force the pair to extend its losses.
Technical outlook
The CCI indicator on the daily chart stays below the -100 mark, suggesting that sellers are still in control of the price action. The pair could face the first support at $1240 (Dec. 13 low) ahead of $1234 (200-WMA) and $1228 (Jul. 16, 2017, low). On the upside, resistances align at $1254 (daily high), $1260 (Jun. 27 high) and $1268 (Jun. 28 high).
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