Gold’s Latest Tilt: Bulls on a Brake, Traders on the Fence
Last week’s scores left the gold bulls feeling a bit deflated. They chased the 25 November highs only to see the price reverse down off the $2726 line. As the new trading week kicks into gear, the market looks a lot calmer – investors are holding their horses and waiting to see what the US Treasury scene is going to do next.
What’s Driving Gold’s Current Chill?
- US 10‑Year Yield Pulse: The real 10‑year yield has gone back above 2%, while the nominal yield rocketed up 24 basis points last week. This shift means gold’s direction is now heavily tied to Treasury movement.
- Potential Rally or Retreat: If traders keep selling and are convinced that a 4.5% upside break is on the cards, we could see gold head toward the lower end of its long‑term range – around $2613 – and even touch that 100‑day moving average near $2600, a line that’s been the rally’s backbone all year.
- Data & Fed Countdown: With a flood of Tier‑1 US data slated for this week and the upcoming Fed meeting, anything could swing the Treasury rates. Gold players will stay on high alert for rising yields, and the same vigil applies to those in equities and FX.
Why the Tension with Treasury Yields Matters
Gold and the USD have had a rocky relationship this year, but when the yields climb as they did, players find it hard to ignore the impact. Higher yields often mean a squeeze on long positions – the gold bulls have to cut back on buying a bit too, or risk being forced out.
Bottom Line
For now, gold traders are on standby, waiting for the Treasury tick to give a clear signal. Keep an eye on the upcoming data releases and the Fed’s stance – the market’s next move could pivot on those numbers.
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