Gold prices moved higher on Tuesday, rebounding as the dollar moved lower and yields dropped. The decline in the 10-year yield came despite a
Gold prices moved higher on Tuesday, rebounding as the dollar moved lower and yields dropped. The decline in the 10-year yield came despite a larger than the expected headline and core CPI report announced on Tuesday by the Department of Labor. Treasury yields appear to be topping out which could lead to a rally in the yellow metal.
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Gold prices moved higher but failed to capture resistance near the 50-day moving average at 1,756. Support is seen near the 10-day moving average at 1,730. Additional support is seen near the June lows at 1,670. Short-term momentum is negative as the fast stochastic generated a crossover sell signal. The current reading on the fast stochastic is 77, down from an overbought condition near 81, which reflects accelerating negative momentum. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. The MACD histogram is printing in positive territory with a declining trajectory which points to consolidation.
Consumer prices surged in March, buoyed by a strong economic recovery and year-over-year comparisons when the Covid-19 pandemic was about to throttle the U.S. economy. The consumer price index rose 0.6% from the previous month but 2.6% from the same period a year ago. The year-over-year gain is the highest since August 2018 and was well above the 1.7% recorded in February. Expectations were for a rise of 0.5% monthly and 2.5% from March 2020. Gasoline prices were the biggest contributor to the monthly gain, surging 9.1% in March and responsible for about half the overall CPI increase.
David Becker focuses his attention on various consulting and portfolio management activities at Fortuity LLC, where he currently provides oversight for a multimillion-dollar portfolio consisting of commodities, debt, equities, real estate, and more.