The Gold Index has suspended two successive days of gains and retreats towards the 20-DMA after bouncing off the 200-DMA amidst a sour market sentiment during the current trading session as US traders come back from a three-day weekend with positive attitude towards the US dollar and US Treasury yields. At $1842.36, the Gold Index remains on the defensive front, almost 0.50% down.
Gold\u2019s Tuesday price action witnessed a test of the 200-DMA at $1840.86, quickly rejected, as depicted by the candlestick. However, gold bears appear to be leaning towards the 20-DMA at $1846.76, maintaining the spot price seesawing in the $5 range. It\u2019s worth noting that the Relative Strength Index (RSI) is at 43.06, in bearish territory, aiming lower, meanings that gold seems poised to break to the downside.
The factors mentioned above, alongside fears of inflation anchored above the US Federal Reserve 2% target, caused a shift towards safe-haven assets. Meanwhile, 10-year breakeven inflation expectations are rising up to 2.63%, signaling that investors are not sure about buying the dip.
Investors\u2019 mood shifted negatively, as witnessed by global equities falling. The US Dollar Index, a gauge of the greenback\u2019s value vs. a basket of rivals, advances 0.50%, sitting at 101.811, underpinned by elevated yields on US Treasuries. The 10-year benchmark note rate is gaining five bps, up at 2.868%.
China\u2019s released its official PMIs for Mat, which increased by 49.6 from 47.4 in April, signaling a minimal recovery after May\u2019s Covid-19 lockdowns. Additionally, reports on Monday\u2019s Asian session said that Shanghai and Beijing would ease some of their restrictions to boost economic growth.
The US economic calendar released Housing data, which came mixed but close to forecasts. The highlight was May\u2019s CB Consumer Confidence, which came at 106.4, better than the 103.9 expected. The report showed that inflation expectations for one year are at 7.4%, lower than April\u2019s 7.5%.
The Fed Regional banks keep releasing their Manufacturing Indexes ahead of June\u2019s 1 ISM Manufacturing PMI. Chicago\u2019s PMI for May rose by 60.3, higher than the 55 expected, but the Dallas Fed Index contracted to -7.3, lower than April\u2019s reading.
Gold\u2019s path of least resistance is tilted to the downside. The XAU\/USD\u2019s first support would be the 200-DMA at $1840.86. Break below would expose the 4-year-old upslope trendline around $1830-34, which, once cleared, would send gold tumbling towards the Bollinger\u2019s band bottom band at $1805.44.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Gold Index has suspended two successive days of gains and retreats towards the 20-DMA after bouncing off the 200-DMA amidst a sour market sentiment during the current trading session as US traders come back from a three-day weekend with positive attitude towards the US dollar and US Treasury yields. At $1842.36, the Gold Index …<\/p>\n","protected":false},"author":13,"featured_media":62122,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[38,37,36],"tags":[6885,6874,8642,6984,8204],"class_list":["post-66302","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-commodities-news","category-forex-markets","category-market-updates","tag-fed","tag-gold","tag-housing-data","tag-treasury-yields","tag-us-treasury-yields"],"_links":{"self":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/66302","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/comments?post=66302"}],"version-history":[{"count":2,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/66302\/revisions"}],"predecessor-version":[{"id":66307,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/66302\/revisions\/66307"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media\/62122"}],"wp:attachment":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media?parent=66302"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/categories?post=66302"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/tags?post=66302"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}