The market looks quieter as traders and investors alike turn their attention to the Federal Reserve's (Fed) annual economic symposium to be held this weekend in St. Jackson Hole, Wyoming. All are waiting for Fed Chairman Jerome Powell's speech for clues on the interest rate outlook.
Despite recent selling pressure, analysts note that the gold market is resilient despite bond yields rising to new 15-year highs. Overnight, the US 10-year bond yield rose to 4.36%, the highest level since late 2007. They also note that a rise in bond yields is negative for gold because it does increases the opportunity cost of holding zero-yield assets like gold. Despite rising bond yields, gold prices managed to hold onto a key support level.
Some analysts say that while yields could move higher in the near-term, an end to the cycle of central bank tightening will eventually hold back gold's rally.
Others argue that gold could benefit significantly if bond yields rise. However, the weakness in US bonds seems to be a natural response to the Fed's move that is expected to keep the rate hike strong.
XAUUSD
BUY 1900 - 1897
TP1: 1905
TP2: 1910
SL: 1893
Despite recent selling pressure, analysts note that the gold market is resilient despite bond yields rising to new 15-year highs. Overnight, the US 10-year bond yield rose to 4.36%, the highest level since late 2007. They also note that a rise in bond yields is negative for gold because it does increases the opportunity cost of holding zero-yield assets like gold. Despite rising bond yields, gold prices managed to hold onto a key support level.
Some analysts say that while yields could move higher in the near-term, an end to the cycle of central bank tightening will eventually hold back gold's rally.
Others argue that gold could benefit significantly if bond yields rise. However, the weakness in US bonds seems to be a natural response to the Fed's move that is expected to keep the rate hike strong.
XAUUSD
BUY 1900 - 1897 TP1: 1905
TP2: 1910
SL: 1893
