- Trade optimism continued weighing on the commodity’s safe-haven status.
- A strong upsurge in the US bond yields added to the intraday selling pressure.
- A modest pickup in the USD demand further collaborated to the weaker tone.
Gold came under some heavy selling pressure during the early North-American session and tumbled to near one-week lows, around the $1490 region in the last minute.
The precious metal extended its pullback from the upper band of a one-month-old trading range, with a combination of negative forces exerting some heavy downward pressure for the second consecutive session on Tuesday.
Weighed down by a combination of negative forces
Against the backdrop of the growing optimism over a possible US-China trade deal later this month, the prevalent risk-on mood was seen as one of the key factors weighing on traditional safe-haven assets – including Gold.
Fading safe-haven demand was further reinforced by a strong intraday upsurge in the US Treasury bond yields, which helped revived the US Dollar demand and also drove flows away from the non-yielding yellow metal.
Adding to this, possibilities of some short-term trading stops being triggered on a sustained move below the key $1500 psychological mark further contributed to the latest leg of a sudden drop over the past hour or so.
Moving ahead, Tuesday’s US economic docket – highlighting the release of ISM non-manufacturing PMI – will now be looked upon for some short-term trading opportunities around the dollar-denominated commodity.
Technical levels to watch
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