Gold Price Prediction – Prices Ease on Strong Treasury Gains

Gold price moved lower on Wednesday as Treasury yields surged. The rally in Treasury yields comes after an inline durable goods order report and ahead of Friday’s Jackson Hole Wyoming event. The dollar was bearly changed against most major currencies and failed to gain traction despite a rally in U.S. yields.

Technical analysis

Gold prices edged lower but were able to bounce near short-term support at the 10-day moving average near 1,786. Resistance on the yellow metal is seen near the 200-day moving average at 1,811. Prices rae overbought as the fast stochastic is printing a reading of 86, above the overbought trigger level of 80 which could foreshadow a correction.  Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This buy signal occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).

Durable Goods Order Decline Less than Expected

Durable goods orders for products meant to last three years decreased 0.1% to $257.2 billion in July month over month according to the Commerce Department Expectations were for a decline of 0.5%.  The increased 0.8% in June from the prior month, unchanged from the initial estimate for the month. Demand for durable goods has increased in 13 of the past 15 months.