Gold is attempting a bounce from two-month lows amid falling yields, although a broadly firmer US dollar is likely to limit the rebound, FXStreet’s Dhwani Mehta briefs.
XAU/USD attempts a bounce amid falling yields, will it last?
“The Fed’s hawkishness has poured cold water over the reflation trades, negatively impact the global stocks and yields. The benchmark 30-year Treasury yields have fallen below the key 2% level, four-month lows, suggesting flattening of the yield curve and receding reflation bets. However, the US dollar continues to hold higher ground, which could likely limit the recovery in the gold price.”
“Gold bulls could turn cautious ahead of a slew of speeches lined up from the Fed policymakers. Tuesday’s Fed Chair Jerome Powell’s testimony will also be closely followed.”
“Gold’s four-hour chart shows that the price is pausing its recovery momentum just below the falling trendline resistance at $1778.”
The next target for the bulls will then be seen at the bearish 21-Simple Moving Average (SMA) at $1801. The further upside will then open up towards the June 17 highs of $1825.”
“A retest of the monthly lows at $1761 could be on the cards if gold price faces rejection at the wedge resistance. Further south, the falling trendline support at $1755 will be the line in the sand for the bullish traders.”
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