Gold witnessed some fresh selling during the Asian session on Thursday as XAU/USD is weighed down by rallying US bond yields and upbeat market mood. A softer tone surrounding the US dollar might extend some support to the dollar-denominated commodity and help limit deeper losses, FXStreet’s Haresh Menghani briefs.
See – Gold Price Analysis: Break below $1760 to leave XAU/USD under pressure – Commerzbank
Key quotes
“Rising inflation expectations, along with the reflation trade continued pushing the US bond yields higher, though did little to provide any meaningful boost to the greenback. This, in turn, might hold bearish traders from placing any aggressive bets.”
“Market participants now look forward to the US economic docket, highlighting the release of the Prelim (second estimate) Q4 GDP print. Apart from this, the US Durable Goods Orders data and speeches by influential FOMC members, will influence the USD and produce some meaningful trading opportunities around the commodity.”
“It is prudent to wait for a sustained breakthrough the wedge resistance, currently around the $1812-13 region, before positioning for any further appreciating move. Some follow-through buying beyond the weekly tops, near the $1816 level, will reaffirm the bullish breakout and push the commodity back towards the next relevant resistance near the $1842 horizontal zone.”
“The $1783-80 area now seems to have emerged as immediate strong support. This is followed by multi-month lows, around the $1760 region and wedge support near the $1751 level. Sustained weakness below might now accelerate the downfall towards the $1725-24 congestion zone before the metal eventually drops to the next relevant support just ahead of the $1700 mark.”
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