Fundamental Overview
Gold has been feeling the pressure from the rise in real yields lately as the opportunity cost of holding into gold at these levels remains high. We will likely need some downside surprise in the US inflation data or weak economic reports to trigger another sustained rally. At the moment, the picture is murky, but the bias is still a bit more bearish.
Gold Technical Analysis – Daily Timeframe
On the daily chart, we can see that gold sold off after setting a new all-time high as the rise in real yields started to weigh on the market. From a risk management perspective, the buyers will have a better risk to reward setup around the 2277 support where we can also find the 38.2% Fibonacci retracement level for confluence. The sellers, on the other hand, will want to see the price breaking lower to increase the bearish bets into the major trendline around the 2150 level.
Gold Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we have a minor upward trendline acting as support for the uptrend on this timeframe. The sellers have the option to lean on the resistance around the 2371 level where they will also find the 38.2% Fibonacci retracement level for confluence, or pile in on a downside breakout of the trendline. The buyers, on the other hand, will want to see the price breaking above the 2371 resistance to invalidate the bearish setup and increase the bullish bets into a new all-time high.
Upcoming Catalysts
Tomorrow we will see the latest US Jobless Claims figures and on Friday, we conclude the week with the US PCE report.
