FORECAST –
XAUUSD
- Gold prices retreat after failing to sustain Monday’s brief bullish breakout
Gold prices surged to a new record near $2,150 during Asian trading. However, the bullish momentum quickly turned into a significant sell-off when European and U.S. markets opened, possibly due to the rebound in bond rates.
U.S. Treasury yields have been declining since late November due to expectations of a Federal Reserve interest rate cut in 2024. However, they increased at the beginning of the week as traders started to reduce bets on excessive monetary easing, which didn't align with the current economic situation. This rise in rates strengthened the U.S. dollar and had a negative impact on precious metals and risk assets.
TECHNICAL ANALYSIS
XAUUSD
Gold took out its all-time high and hit a fresh record on Monday, but was quickly slammed lower, signaling that the breakout was possibly a fakeout.
Despite the market reversal, gold remains biased towards upside movement. If prices continue to rise, the first resistance is at $2,050, followed by $2,070/$2,075. Further strength could lead to a focus on $2,150.
However, if losses increase in the coming days, initial support is seen at $2,010. This level may act as a floor, but a drop below it could suggest a deeper pullback with the next target at $1,990.
XAUUSD
- Gold prices retreat after failing to sustain Monday’s brief bullish breakout
Gold prices surged to a new record near $2,150 during Asian trading. However, the bullish momentum quickly turned into a significant sell-off when European and U.S. markets opened, possibly due to the rebound in bond rates.
U.S. Treasury yields have been declining since late November due to expectations of a Federal Reserve interest rate cut in 2024. However, they increased at the beginning of the week as traders started to reduce bets on excessive monetary easing, which didn't align with the current economic situation. This rise in rates strengthened the U.S. dollar and had a negative impact on precious metals and risk assets.
TECHNICAL ANALYSIS
XAUUSD
Gold took out its all-time high and hit a fresh record on Monday, but was quickly slammed lower, signaling that the breakout was possibly a fakeout.
Despite the market reversal, gold remains biased towards upside movement. If prices continue to rise, the first resistance is at $2,050, followed by $2,070/$2,075. Further strength could lead to a focus on $2,150.
However, if losses increase in the coming days, initial support is seen at $2,010. This level may act as a floor, but a drop below it could suggest a deeper pullback with the next target at $1,990.
