Gold price remains resilient despite rising real US interest rates, indicated by the United States 10-Year TIPS yield. Normally, higher interest rates would pressure gold prices, but the recent increase in T-Bond yields has been driven by concerns about growing government debt rather than inflation or Fed policy changes.
This divergence is linked to gold's ability to hold up amidst rising T-Bond yields. The increase in T-Bond yields stems from worries about government debt growth due to spending plans and potential deficit spending during an economic downturn. This shift in focus has not been as bearish for gold as usual, because the same concerns boosting T-Bond yields are also increasing demand for gold.
Investors see gold as a hedge against potential economic and monetary consequences arising from mounting government debt, such as slower growth and potential central bank involvement in financing government needs. This highlights the intricate relationship between macroeconomic factors and the gold market, where non-traditional influences can shape price trends.
On the technical side, both MACD and RSI are showing BUY signals, confirming that the yellow metal still has a potential to grow.
If this trend continues, the bulls might actively start entering at the point of 1942.07 and then the price might reach levels of 1963.29. In the opposite scenario, the price might reach its support at 1921.01.
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This divergence is linked to gold's ability to hold up amidst rising T-Bond yields. The increase in T-Bond yields stems from worries about government debt growth due to spending plans and potential deficit spending during an economic downturn. This shift in focus has not been as bearish for gold as usual, because the same concerns boosting T-Bond yields are also increasing demand for gold.
Investors see gold as a hedge against potential economic and monetary consequences arising from mounting government debt, such as slower growth and potential central bank involvement in financing government needs. This highlights the intricate relationship between macroeconomic factors and the gold market, where non-traditional influences can shape price trends.
On the technical side, both MACD and RSI are showing BUY signals, confirming that the yellow metal still has a potential to grow.
If this trend continues, the bulls might actively start entering at the point of 1942.07 and then the price might reach levels of 1963.29. In the opposite scenario, the price might reach its support at 1921.01.
Risk Disclosure: Trading Foreign Exchange (Forex) and Contracts of Difference (CFD's) carries a high level of risk. By registering and signing up, any client affirms their understanding of their own personal accountability for all transactions performed within their account and recognizes the risks associated with trading on such markets and on such sites. Furthermore, one understands that the company carries zero influence over transactions, markets, and trading signals, therefore, cannot be held liable nor guarantee any profits or losses.