Gold prices fell on Thursday morning in Asia, but a weaker USD and falling bond rates in the United States, which have fallen from a three-week high, helped to limit the precious metal’s losses. Gold futures were down 0.09% at $1,868.60 by 11:38 p.m. ET (4:38 a.m. GMT) on Thursday, after soaring to a historic over-five-month peak on Wednesday afternoon. The Greenback, which generally goes in the opposite direction of Gold, dipped slightly on Thursday, although it remained close to a 16-month high.
Benchmark 10-year Treasury rates inched up a little bit on Thursday, although they were still down from the three-week peak reached the previous day. A bond auction for 20-year bonds ended in disappointment as well. Investors are nonetheless apprehensive about central banks raising interest rates more quickly than they had anticipated.
According to Chicago Fed President Charles Evans, the Federal Reserve will not finish asset tapering until the middle of 2022, as previously stated. Evans went on to say that the monetary authority would keep monitoring whether or not record-high rates of inflation will begin to decline. In the United Kingdom, an increase in inflation in October fueled speculation that the Bank of England would raise interest rates in December. The consumer price index increased by a stronger-than-expected 1.1% month-on-month and 4.2% year-on-year, compared to expectations.
According to Isabel Schnabel, a member of the European Central Bank’s board of directors, the ECB must be prepared to reel inflation in the Eurozone if it appears to be more lasting than predicted. Conversely, assets in the SPDR Gold Trust increased by around 0.1% on Wednesday, to 976.87 tons, according to the SPDR. Silver gained 0.2% in other precious metals following research by the Silver Institute predicting that global silver demand will reach one billion ounces in 2021, the first time since 2015. Platinum and palladium prices increased by 0.3%.
Gold Price Technical Analysis
XAU/USD CHART Source: Tradingview.com
Per the Technical Confluences Detector, the Gold price is wending its way below the important topside obstacle of $1,870, which corresponds to the intersection point of the preceding week’s high and the previous day’s high. Acceptance of the latter will signal the start of a new climb towards $1,880, which is the pivot point for the market’s one-day R2. The upside will be guarded by the junction of the pivot point one-day R1 and the Bollinger Band four-hour Upper at $1,873, which will occur before that.
If the bulls show signs of extending their claws, the pivot point one-month R3 at $1,884 will be challenged. Sellers must first establish a firm footing below $1,862, which is the confluence of the Fibonacci 38.2% one-day and the SMA5 one-day. The next crucial support level is identified at around $1,857, which corresponds to the junction of the Fibonacci 61.8% one-day and Fibonacci 23.6% one-week Fibonacci retracement levels. One-month R2 at $1,850, which serves as a pivot point, would be the last defense for Gold bulls.