FX.co ★ HiDe_N_SeEk | XAU/USD, GOLD

As traders concentrated on the strengthening dollar and rising Treasury yields, gold tested new lows. Bond traders' wagers that the Fed will have to hike rates to combat inflation caused Treasury yields to rise. While the yield on 10-year Treasuries settled above 4.65%, the yield on 2-year Treasuries increased above 4.10%. Crucially, the 30-year Treasury yield attempted to reach a level over 5.20%. The increase in long-term yields indicates that investors are concerned about the prospects for long-term inflation. It should be mentioned that there has been a sell-off in European debt markets today as well. Japan's yields reached multi-decade highs. It appears that some traders are compelled to sell their positions in other markets in order to offset losses due to the uneasy mood in the bond market. The demand for safe-haven assets increased due to rising yields, which was positive for the US dollar. Gold and other commodities denominated in dollars are negative when the dollar is strong because buyers using other currencies will find them more costly. As markets braced for the possible resumption of the military campaign against Iran, Brent oil prices increased slightly. If Iran does not accept a deal, President Trump threatened to resume strikes. The demand for riskier assets decreased as global tensions increased, which was negative for gold. Technically speaking, gold is still trying to settle below the $4530–$4550 support line. Gold will go toward the next support, which is situated in the $4350–$4370 zone, if it is able to settle below the $4530 level. There is a lot of room to develop momentum in the near future because the RSI is in the moderate range.

Gold's decline below the swing low of $4,500 from early May to a low of $4,453 on Monday set off a continuation of the bearish downturn. After that, buyers regained control over the day, with trade continuing close to the day's highs, which are currently around $4,552 as of this writing. In addition to placing it in a likely positive position for the day, this also creates a lower high and a lower low, maintaining the short-term negative structure. On Monday, a little drop below the previous trend low of $4,500 set off the negative continuation. Then, on Tuesday, a closing below that previous low confirmed the bearish signal. But Wednesday's intraday rally and probable close over $4,500 indicate that bearish momentum is slow, which raises the prospect of a bounce before more declines, assuming that's what happens. The 20-day moving average at $4,627 or the 50-day moving average near $4,681 might be tested as resistance on a bounce if buyers can maintain control and surpass Tuesday's high of $4,589. Given the current bearish corrective structure, resistance is expected on a bounce. For that probability to begin to shift, the 50-day moving average would need to be steadily reclaimed. The 50-day moving average offers a clear upside target zone because it was tested during the previous rally in May. However, negative momentum will intensify if resistance is observed lower, close to the 20-day moving average, and it is followed by a loss. Gold has a significant potential support zone that extends from the February low of $4,401 to the 200-day moving average, which is now close to $4,366. The increased angle of fall of an internal downtrend line that connects to the May lower swing high indicates an increase in underlying bearish momentum.