- Gold is taking heavy losses ahead of the weekend.
- The yield on 10-year US Treasuries rose more than 2% on Friday.
- The US Dollar Index remains close to 94.00 after US retail sales data.
The oro started the last day of the week on the back foot and extended its decline to a new daily low of $ 1,770 in the early trading hours of the US session. At the time of writing, the pair XAU/USD it was down 1.2% on the day at $ 1,774.
The sharp rally seen in US Treasury yields appears to be weighing heavily on XAU / USD on Friday. The yield on the benchmark 10-year US Treasury, which closed the previous three days in negative territory, is currently rising 2.3% to 1.55%.
Meanwhile, upbeat US data is helping the dollar find demand as well. The US Census Bureau reported that retail sales in September increased 0.7% on a monthly basis, beating the market’s expectation of a 0.2% contraction by a wide margin. In addition, the August increase of 0.7% was revised up to 0.9%.
For the moment, the US dollar index is stable around 94.00. Later in the session, the University of Michigan’s preliminary consumer sentiment index for October will be examined for further momentum.
It’s also worth noting that US stock index futures were up 0.35% to 0.6% on the day, suggesting risk flows are likely to dominate financial markets ahead of the weekend.
Gold technical outlook
On the four-hour chart, gold is trading below the 200-period SMA. Also, the Relative Strength Index (RSI) indicator is holding around 40, suggesting that there is more room to the downside before XAU / USD is technically oversold.
Previous static resistance at $ 1,768 now lines up as the first support before $ 1,758 (100-period SMA) and $ 1,750 (static level). On the upside, the initial hurdle is at $ 1,775 (200-period SMA). In case the pair achieves a daily close above that level, buyers could look to test $ 1,800 (psychological level).
Technical levels
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