Spot gold prices are under pressure due to rising U.S. bond yields, focus on U.S. CPI in July
So far, the second half of the summer has had little impact on gold, which again approached $2,000 before falling back to $1,900, where it spent most of late June and early July.
Rising yields, especially in the U.S., and a stronger dollar are largely responsible for this, but there may still be some element of uncertainty in the economic data that is making traders a little nervous.
Analysts believe that the end of the tightening cycle has finally been reached – or very close to it – and now we don’t know how long we will be stuck here. We’ve seen some notable improvements in some areas, but not enough to convince policymakers that the case for rate hikes has passed, let alone for another easing at the start of the year.
That narrative could change if we see further improvement in the data, starting with today’s US CPI, but for now, the jitters are quietly making a comeback.
Technically, if the price breaks below the June low (~$1,893), it could be a very bearish signal for several reasons.
First, it would make the July 20 rotation all the more important and confirm the previous rally as a pullback, suggesting a broader decline may still be in play.
More importantly, a break below the 200/233-day simple moving average, whose lower boundary is around $1,860, could be seen as another very bearish development.
At 14:37 Beijing time, the spot gold price was at $1917.66 per ounce.
2023-08-10 06:38:00
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