- The gold price is falling on higher US yields and risk appetite.
- US housing data continues to deteriorate, adding to Monday’s New York Fed manufacturing index, reigniting recession fears.
- Investors are awaiting the minutes of the last FOMC meeting on Wednesday and the new spokesperson for the Fed.
the price of gold falls due to a rally in US Treasury bond yields, amid mixed market sentiment, with EU and US stocks split between winners and losers at the start of the American session . Meanwhile, mixed economic data out of the US has traders continuing to assess the US economic outlook in the short to medium term. At the time of writing this report, the XAU/USD It is trading at $1,776.72 a troy ounce.
XAU/USD falls on rising US bond yields amid mixed US data.
Gold is under pressure from slightly improving sentiment. Meanwhile, US industrial production rose for the first time in three months, reading 0.6% mom, underpinned by motor vehicles, which benefited from improvements in chip supplies. Previously, building permits and housing starts plummeted, down -1.3% MoM and -9.6% MoM, respectively, indicating that increases in the Federal Funds Rate (FFR) are making a dent in the real estate market.
Additionally, a grim reading on regional Federal Reserve Banks, led by the New York Fed’s Empire State Index, paints a bleak picture of a coming recession in the United States.
Apart from this, US Treasury yields, a headwind for the price of the yellow metal, are rising, led by the short term of the curve. The 10-year US Treasury bond yield stands at 2.851%, up six basis points, erasing Monday’s losses.
For its part, the dollar index, an indicator of the value of the USD against a basket of pairs, remains almost flat at 106.473, with a slight decrease of 0.02%,
What to watch out for
The minutes of the US Federal Reserve Open Market Committee from its last meeting and the Fed will speak, led by Esther George of the Kansas City Fed and Neil Kashkari of the Minnesota Fed.
Gold Price Analysis (XAU/USD): Technical Outlook
From a daily chart perspective, XAU/USD has a neutral bias, clinging below the 50-day EMA at $1,780. It is worth noting that the RSI is heading down, approaching the 50 midline, and the 100 day EMA crossed below the 200 day EMA, which could compound a move lower. However, unless the sellers retake the 20-day EMA at $1,760.70, consolidation in the $1,780-$1,810 zone is expected.
Source: Fx Street
With 6 years of experience, I bring to the table captivating and informative writing in the world news category. My expertise covers a range of industries, including tourism, technology, forex and stocks. From brief social media posts to in-depth articles, I am dedicated to creating compelling content for various platforms.
