“¢ Easing US-China trade tensions dampen safe-haven demand and exert fresh pressure.
“¢ Rising US bond yields underpin the USD and further collaborate to the intraday slide.
Gold came under some renewed selling pressure on Tuesday and slipped back closer to two-week tops, around the $1274 region in the last hour.
A slight improvement in the global risk-appetite, amid easing US-China trade tensions turned out to be one of the key factors weighing on the precious metal’s perceived safe-haven demand. Traders cheered a reprieve in the US-China trade tensions after the US Commerce Department temporarily allowed Chinese telecommunications giant Huawei to continue to purchase the US made goods until Aug. 19.
This coupled with a modest US Dollar uptick exerted some additional pressure on the dollar-denominated commodity. The greenback bulls took cues from higher US Treasury bond yields, which climbed to over one-week tops in reaction to the Fed Chair Jerome Powell’s comments that it was premature to make a judgment about the impact of trade-tariffs on monetary policy and dampened rate cut hopes.
Hence, the key focus will remain on Wednesday’s important release of minutes of the latest FOMC monetary policy meeting, which might now play an important role in determining the next leg of a directional move for the non-yielding yellow metal.
Moving ahead, today’s US economic docket – featuring the release of existing home sales, will influence the USD price dynamics, which coupled with the broader market risk sentiment might further collaborate towards producing some short-term trading opportunities.
Technical levels to watch