- Rebound in the price of gold that began on Tuesday continues apace.
- XAU/USD breaks above $1,925 and enables further rallies.
- Falling yields and dollar weakness contribute to gold’s rise.
Commodities are rising on Wednesday and gold is no exception. The precious metal is up 0.70% and trading at two-day highs above $1,930. After the start of the American session, it reached $1,934, almost $50 above the low of the previous day.
The rise in gold comes in the face of a general decline in the dollar. The greenback continues to correct lower. DXY is testing recent weeks lows at 97.75, a far cry from levels of just 48 hours ago.
The US data did not surprise but did not help the dollar. The drop in Treasury bond yields is being a negative factor. The 10-year tranche yields 2.38%, far from the day’s peak of 2.43% and closely eyeing the weekly low.
Another positive factor for gold is technical. The strong reversal still keeps the bullish tone intact. The price broke through $1925, a resistance to watch out for. The next strong barrier can be seen around $1937 and then $1950. A drop below $1920 would take gold’s momentum, while losing $1910 would intensify bearish pressure.
Technical levels
Source: Fx Street
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