FX.co ★ Sud | XAU/USD, GOLD

In early Asian trading, gold (XAU/USD) prices held steady around $4,140, pressured by a strong US dollar and a sharp rise in US Treasury yields. The yield on the benchmark 10-year Treasury note jumped nearly 7 basis points to 5.349%, its highest level since April 2002, before easing slightly to 5.30%. Meanwhile, the 30-year Treasury yield also surged, nearing its highest level in over 20 years. This upward pressure on interest rates, coupled with rising sovereign bond yields that increase the opportunity cost of holding non-interest-bearing gold, has weighed heavily on the precious metal, offsetting the positive impact of a weak macroeconomic environment. The upward pressure on yields and the dollar was countered by a decline in market expectations for an imminent tightening of monetary policy by the Federal Reserve. Weaker-than-expected non-farm payrolls data last week, along with downward revisions to previous months' figures, also contributed to the shift in market sentiment. According to CME FedWatch data, the probability of an October interest rate hike has fallen sharply to around 22.7%. However, market analysts point out that the reduced risk of a rate hike alone may not be enough to achieve a sustained recovery in gold prices. Observers emphasize the need for continued declines in long-term bond yields, while persistent inflation concerns—exacerbated by rising oil prices amid geopolitical tensions—continue to fuel worries about term premiums and further complicate the outlook for overall monetary policy. On the monetary policy front, comments from the Federal Reserve have reinforced the view that the dollar is structurally strong. Policymaker Logan delivered hawkish remarks, suggesting that monetary policy may not be tight enough to sustainably return inflation to the 2% target. This hawkish stance is reflected in the FXS Fed Investor Confidence Index, which remains above neutral territory at 136.59, reinforcing market expectations of an aggressive policy approach from the Fed and making risky assets sensitive to changes in borrowing costs. Technically, the (XAU/USD) is showing a cautious short-term bearish bias on the daily chart. The market price remains confined below the middle Bollinger Band and the 100-day simple moving average, fluctuating around $4,275. Meanwhile, the 14-day Relative Strength Index (RSI) is at 38.41, indicating continued downward pressure rather than an immediate rebound from oversold territory. The initial support level lies near the lower Bollinger Band, close to $4,100; a break below this level would trigger a deeper correction, while holding above it would maintain a defined range-bound trading pattern.