Gold Price Prediction – Prices Slip on Treasury Yield Gains

Gold prices continued to move lower after, hitting resistance.The dollar edged lower but there seemed to be more focus by Presicoul metals traders on U.S. yields. U.S. yields surged higher, which seemed to put downward pressure on the yellow metal. Since gold is priced in dollars, a stronger greenback usually translates into lower gold prices. Retail sales in the U.S. were stronger than expected, while import prices surged.

Technical analysis

Gold prices reversed and moved lower putting through support, which is now resistance near the 10-day moving average at 1,776. Support is seen near the September lows at 1,721. Short-term momentum turned negative as the fast stochastic generated a crossover sell signal. Gold prices moved out of oversold territory and are in the middle of the neutral range. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This 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). The MACD histogram is printing in positive territory but the upward sloping trajectory is decelerating, which points to consolidation.

Industrial Production Declines

U.S. industrial production fell 1.3% in September, more expected as the lingering effects of Hurricane Ida continue to generate contraction. The Federal Reserve reported that most of 0.6%, of the overall decline in total industrial production was attributable to the hurricane. It was the worst showing since February’s 3.1% decline.