GOLD FORECAST: PRECIOUS METALS STILL PRESSURED BY RISING REAL YIELDS, US DOLLAR STRENGTHGold value motion extends decrease to sta
GOLD FORECAST: PRECIOUS METALS STILL PRESSURED BY RISING REAL YIELDS, US DOLLAR STRENGTH
- Gold value motion extends decrease to start out the week as actual yields and the US Greenback rise additional
- Treasured metals have confronted severe headwinds and danger dropping into bear market territory
- Gold outlook might flip much more downtrodden with a breakdown of its bull flag sample
- Sharpen your technical evaluation abilities or study implied volatility buying and selling methods!
Treasured metals proceed to lose their luster as gold and silver costs lengthen their selloff. Gold value motion simply dropped one other -1.2% throughout Monday commerce to print a contemporary nine-month low and leaves it essentially the most oversold since August 2018. The value of gold now hovers getting ready to bear market territory close to $1,680/oz. This newest stretch decrease might see gold promoting stress speed up as a result of newest breakdown of technical help round $1,690/oz.
GOLD PRICE CHART WITH US DOLLAR INDEX OVERLAID: WEEKLY TIME FRAME (DEC 2019 TO MAR 2021)
Chart by @RichDvorakFX created utilizing TradingView
One main driver of gold value weak spot has been surging actual yields. Extra just lately, the rise in actual yields has additionally corresponded with a stronger US Greenback. This poses a significant headwind for gold bulls contemplating the valuable steel sometimes maintains an inverse relationship with the US Greenback.
| Change in | Longs | Shorts | OI |
| Each day | 4% | 10% | 5% |
| Weekly | 10% | -23% | 4% |
Gold value motion seems to be at a essential juncture with its broader bull flag chart sample now in jeopardy following the newest stretch decrease. Failure to catch a bid off this key technical barrier would possibly open the door to a deeper pullback towards long-term trendline help prolonged by way of the April 2019 and March 2020 swing lows. If a rebound try comes into play, nevertheless, gold bears would possibly look to fade the 20-day easy transferring common.
— Written by Wealthy Dvorak, Analyst for DailyFX.com
Join with @RichDvorakFX on Twitter for real-time market perception
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