- Gold loses strength in the face of rising yields, stronger dollar and lower stock markets.
- XAU/USD found resistance at $1725 and changed direction.
Gold is trading at $1713, the low of the day. Hours ago it had tested $1725, but the combination of a decline in the equity markets, stability in the bond market and the rise in the dollar, complicated the outlook for the yellow metal on Thursday.
Yields limit gold recovery
The rises in gold have a stumbling block ahead, which are the yields on Treasury bonds. The better-than-expected data that was released from the US, together with the statements of Federal Reserve officials, pointing out that the rate hike will continue and that they do not see a 2023 with falls, continues to put pressure on bonds.
The 10-year Treasury bond yields 3.77%, although it is far from the recent peak above 4%, it is also far from the weekly floor of 3.56%. The rally from the bottom contributed to gold being unable to break above the $1725/30 zone.
Short-term tone continues with some bullish momentum in XAU/USD. This could change on a drop below $1,707 (4-hour 20 moving average); although below $1695 would be a stronger signal. On the upside of breaking above $1,730, the yellow metal would be poised to extend gains, with next resistance around $1,740.
On Thursday in the US data will be published for request for unemployment benefits. Several Federal Reserve officials (Neel Kashkari, Charles Evans, Lisa Cook, Christopher Waller and Loretta Mester) will speak in public. On Friday it will be the turn of the official employment report for September, with non-farm payrolls expected to have increased by 250,000.
|Today last price||1714.65|
|Today Daily Change||-1.60|
|Today Daily Change %||-0.09|
|Today daily open||1716.25|
|Previous Daily High||1727.85|
|Previous Daily Low||1700.53|
|Previous Weekly High||1675.49|
|Previous Weekly Low||1614.85|
|Previous Monthly High||1735.17|
|Previous Monthly Low||1614.85|
|Daily Fibonacci 38.2%||1710.97|
|Daily Fibonacci 61.8%||1717.41|
|Daily Pivot Point S1||1701.9|
|Daily Pivot Point S2||1687.56|
|Daily Pivot Point S3||1674.58|
|Daily Pivot Point R1||1729.22|
|Daily Pivot Point R2||1742.2|
|Daily Pivot Point R3||1756.54|
Source: Fx Street