Gold Price Forecast: XAU/USD Hits Two-Year Low Near $1640

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  • Gold is under pressure as stocks plunge and bond yields rise.
  • Yellow metal tries to recover ground, the key is at $1655.
  • The dollar jumps to 20-year highs, putting further pressure on gold.

The Prayed could not hold above $1655 and broke below falling to $1641, the new low since mid-2020. From the bottom it bounced back and is trading around $1650, under pressure.

The combination of a strong dollar and rising Treasury bond yields, in a context of pessimism in the markets, is having a negative impact on gold. Equity markets are crashing, but despite this, sovereign bonds are crashing too.

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The The only safe haven on the horizon is the dollar. The DXY rose above 112.00 reaching 20-year highs. The 10-year Treasury bond yields 3.75%, after having reached above 3.80% hours ago.

The plunge in bonds weighs on gold which falls 1.30%, while silver slumps 2.65%. Wall Street futures lose more than 1% and in Europe the main markets fall more than 2%.

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Gold, if it remains below $1655, will continue to head lower. Supports are seen at $1,640, followed by $1,625 and $1,610. In the opposite direction, a return above $1,660 would alleviate bearish pressures, while a more sustainable rebound could be expected after a firming above $1,680.

Technical levels

XAU/USD

Panorama
Last Price Today 1649.51
Today’s Daily Change -21.75
Today’s Daily Change % -1.30
Today’s Daily Opening 1671.26
Trends
20 Daily SMA 1701.37
50 Daily SMA 1732.87
100 Daily SMA 1777.47
200 Daily SMA 1829.16
levels
Previous Daily High 1684.95
Previous Daily Minimum 1655.69
Previous Maximum Weekly 1735.17
Previous Weekly Minimum 1654.17
Monthly Prior Maximum 1807.93
Previous Monthly Minimum 1709.68
Daily Fibonacci 38.2% 1666.87
Daily Fibonacci 61.8% 1673.77
Daily Pivot Point S1 1656.32
Daily Pivot Point S2 1641.37
Daily Pivot Point S3 1627.06
Daily Pivot Point R1 1685.58
Daily Pivot Point R2 1699.89
Daily Pivot Point R3 1714.84

Source: Fx Street

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