Gold Declined Towards The Support At $1915
- Rising Treasury yields continue to put pressure on gold.
- Geopolitical situation remains tense, which may provide support to gold.
- A move below the support at $1915 will push gold towards the support level at $1900.
Gold Is Losing Ground As Treasury Yields Move To New Highs
Gold is testing the support level at $1915 as rising Treasury yields serve as a significant bearish catalyst. The yield of 2-year Treasuries continues its attempts to settle above the resistance at the 2.20% level as traders remain worried about rising inflation.
Longer-term yields are also moving higher, and the yield of 30-year Treasuries has recently made an attempt to settle above 2.64%. These levels have not been seen since July 2019.
The rapid increase in Treasury yields put material pressure on gold and offset the positive impact from strong demand for safe-haven assets. The U.S. dollar has also gained some ground in recent trading sessions, adding to pressure on gold.
However, it should be noted that there is no positive news from Russia – Ukraine negotiations, so demand for safe-haven assets may increase, which will be bullish for gold and other precious metals.
Gold failed to settle above the resistance at the 20 EMA near $1935 and moved towards the support level at $1915. A successful test of this level will push gold towards the support at the 50 EMA at $1900.
If gold manages to settle below the 50 EMA, it will move towards the next support level, which is located at $1880. A move below this level will open the way to the test of the support at $1865.
On the upside, the nearest resistance level for gold is located at the 20 EMA. If gold gets back above the 20 EMA, it will gain upside momentum and move towards the resistance level at $1950. A successful test of this level will push gold towards the resistance at $1975.
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