- Gold resumes declines after brief upward correction.
- Rise in US yields and dollar strength keep XAU/USD under pressure.
- 10-year bond exceeded 4% for the first time in more than a decade.
The Prayed resumed the downward path and fell to $1614, reaching the lowest level since April 2020. Downside pressures on metals remain firm, in a context of risk aversion and rise in sovereign bond yields.
The XAU/USD It traded above $1,640 on Tuesday, but failed to consolidate and started losing ground in the American session. Since then it has moved in a bearish direction, breaking through the $1,620 area and making new lows.
The next support looms at $1610 and then the round zone at $1600 appears. The negative moment remains firm. In intraday terms, a rally above $1,628 could ease bearish pressures temporarily.. Just a firm return above $1,650 would be a factor that could anticipate a more sustained respite.
Market conditions remain negative for gold. The main factor behind it is what is happening in the sovereign bond market. The rises are widespread. The 10-year US Treasury bond topped 4% on Wednesday for the first time in more than a decade.
Another negative element is risk aversion which further strengthens the US dollar. DXY is at 20-year highs above 114.50. Wall Street futures point to a negative opening with falls of more than 1.05% on average.
The US economic calendar for Wednesday highlights the pending home sales report for August, the foreign trade report and a presentation by Jerome Powell, the chairman of the Federal Reserve.
Technical levels
Source: Fx Street
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