- XAU/USD breaks range but remains above strong short-term support.
- US dollar gains momentum during the American session as US yields rise further.
Gold price broke an intraday range to the downside. It bottomed at $1,483/oz, the lowest level since October 16. The slide found support above $1,490 and near the end of the session, it trades at $1,483 down $7 for the day.
A stronger US Dollar pushed gold to the downside. The rebound in US yields played a key role. The 10-year reached today 1.805%, the highest level since October 19.
In the short-term, XUA/USD continues to consolidate, on what could be seen as a pause of the bearish correction or of the main bullish trend. A break above $1,520 would point to a resumption of the trend, while a daily close under $1,475 would sign more losses ahead.
On a long term perspective, analysts at TD Securities still see Gold moving above $1,600/oz next year as global central banks cut further amid a global economic slowdown, the Fed’s communiqué on the potential for additional rate cuts are not as certain. “The risk that prices will break lower is growing, with current prices challenging the upward trend which formed this summer. Risk appetite may firm due to a possible US-China trade deal and as the belief that monetary easing will help the economy avoid a steep downturn grows, which may reduce interest in the yellow metal for now.”