Search ForexCrunch
  • Gold reverses sharply and tumbles as stocks turn negative in Wall Street.
  • The downside in metals limited by falling US yields.

Gold prices declined $20 from the weekly high it reached after US economic data. XAU/USD bottomed at $1835/oz while at the same time Wall Street tumbled and the VIX index soared.

Gold loses its shine

Metals peaked on Wednesday after a lower-than-expected reading of US inflation for January and on the back of risk appetite. It climbed to $1855, the highest level since February 2 and then bounced then lost momentum.

A sharp and quick decline in stock indices in Wall Street sent XAU/USD to $1835, the lowest level since Asian hours. Over the last minutes, shares erased most of its losses favoring a rebound in gold back to the $1840 area.

The yellow metal looks vulnerable despite holding above daily lows and the recent rebound. The key short-term support is seen at $1830/35 and below at $1820.

The decline in US yields limited the decline in gold and silver. The 10-year yield dropped to 1.13%, a five-day low. As of writing, the Dow Jones is flat after recovering almost two hundred points over the last minutes. The S&P 500 drops 0.13%.

Technical levels