- Gold fell back but managed to hold above $1,850.
- Lower Treasury yields offer support for the yellow metal.
- Negative climate in equity markets, another risk factor.
The Gold is falling moderately on Monday, paring some of Friday’s strong rally from $1820 to $1865. The metal’s correction found support at the $1850 zone. In the pre-opening of Wall Street it is trading around $1855.
The technical picture for gold remains positive in the short term. A drop below $1845 could take the momentum out of it, with the next key support below at $1835. To the upside, the $1865/67 area is a consideration level and a day close abovewould be the highest since June of last year and could enable further increases.
The key factor behind Friday’s rally was a fall in Treasury bond yields, which was even stronger than the appreciation of the dollar in a context of collapsing equity markets. History repeats itself on Monday, but the bad climate in the equity markets is being more significant than the rise in the price of Treasury bonds.
In Europe, the main markets lose more than 3% and Wall Street futures are in the red. Concerns about a monetary tightening took a backseat on Monday, where the market climate is marked by fears of a war between Russia and Ukraine.
Technical levels
Source: Fx Street
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