Gold Prices Slide but Bounce at Support

Key Insights

• Gold prices declined but bounced from the lows
• The dollar dropped sharply but failed to buoy the yellow metal
• U.S. Treasury yields were mixed

Gold prices eased further on Tuesday after declining on Monday despite a decline in the greenback. Gold is quoted in dollars, and usually, a weaker dollar buoys gold prices. Treasury yields were mixed as the 10-year eased and the 2-year strengthened in the wake of a robust JOLTS report.

On Tuesday the Labor Department reported the January JOLTs report. Job openings totaled 11.26 million in January, more than the 10.9 million estimate. The robust level of job openings  brought the total vacancies to 4.75 million more than available workers. The quits level, declined to its lowest total since October.

Technical Analysis

Gold moved lower on Tuesday but bounced near support. Support is seen near the 50-day moving average at $1,892. Resistance is seen near the 10-day moving average at 1,934. Short-term momentum is negative as the fast stochastic generated a crossover sell signal. Prices are oversold. The fast stochastic is printing a reading of 19, below the oversold trigger level of 20, foreshadowing a correction.

The medium-term momentum has turned negative. The MACD histogram prints in negative territory with a decelerating trajectory that points to lower gold prices.