Gold Continues Consolidation In The $1915 – $1935 Range

Key Insights

• Gold traders wait for additional catalysts that could move gold out of the current trading range. 
• Treasury yields have pulled back from highs, but higher yields remain a key concern for gold bulls. 
• A move below the support at $1915 will push gold towards the support level at $1900.

Gold Stays Range-Bound

Gold remains stuck in the $1915 – $1935 range as traders remain focused on the near-term outlook for Treasury yields.

The yield of 2-year Treasuries has recently made an attempt to settle above 2.60% but lost momentum and pulled back below the 2.45% level. It should be noted that the yield of 2-year Treasuries moved from 1.30% to 2.60% in less than two months, so it’s hard to expect that it will continue to move higher in a straight line.

However, higher yields remain the key concern for gold bulls, and the continuation of the current upside trend may put more pressure on gold markets.

Meanwhile, VanEck Gold Miners ETF managed to stay above the $38 level during yesterday’s trading session. However, GDX will likely need more support from the gold markets to have a chance to get back above the $39 level in the near term.

Technical Analysis

Gold continues to trade in the range between the support at $1915 and the resistance at $1935. Most likely, gold will be able to develop significant momentum when it manages to get out of this range.

If gold settles above $1935, it should quickly get to the test of the resistance level at $1950. A successful test of this level will push gold towards the next resistance, which is located at $1965.

On the support side, a move below the support at $1915 will push gold towards the support at $1900, although gold can also get some support at the 50 EMA at $1910. In case gold manages to settle below the support at $1900, it will head towards the next support level at $1880.

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