Gold: Extends its fall towards $1,700 after the US data.

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  • Gold is down more than 1% in trading on Wednesday.
  • The 10-year US Treasury bond yield rises in the American session.
  • The Fed’s aggressive bets boost the dollar after the publication of the latest data.

Gold came under further downward pressure and fell towards $1,700 during American trading on Wednesday. At the time of writing, XAU/USD lost 1.25% on the day, trading at $1,705.

Dollar Rises Alongside US Yields

The impressive rebound seen in US Treasury yields amid Fed bets weighs on the precious metal midweek. After falling sharply earlier in the week, the 10-year US Treasury yield has risen more than 4% on the day to 3.78%. According to the CME Group’s FedWatch tool, markets value the probability of a 75 basis point interest rate hike in November at 68%.

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Data from the United States showed on Wednesday that private sector employment increased by 208,000 people in September, above market expectations of 200,000.

In addition, the ISM services PMI came in at 56.7, showing that business activity in the service sector continued to grow at a good pace in September. More importantly, the PMI employment index rebounded to 53 from 50.2, reviving expectations for a non-farm payroll report on Friday. The Dollar Index was up 1.33% on the day, reflecting the positive impact of Wednesday’s data on the dollar’s valuation.

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There will be no other high-level macro data releases later in the day and movements in US yields will likely continue to weigh on XAU/USD action, which is inversely correlated.

Technical levels to consider

XAU/USD

Overview
last price today 1705.45
today daily change -20.73
daily change today -1.20
Daily opening today 1726.18
Trends
daily SMA20 1679.83
daily SMA50 1724.74
daily SMA100 1763.48
daily SMA200 1823.63
levels
Previous daily high 1729.58
Previous Daily Low 1695.18
Previous Weekly High 1675.49
Previous Weekly Low 1614.85
Previous Monthly High 1735.17
Previous Monthly Low 1614.85
Daily Fibonacci 38.2% 1716.44
Daily Fibonacci of 61.8% 1708.32
Daily Pivot Point S1 1704.38
Daily Pivot Point S2 1682.58
Daily Pivot Point S3 1669.98
Daily Pivot Point R1 1738.78
Daily Pivot Point R2 1751.38
Daily Pivot Point R3 1773.18

Source: Fx Street

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