Gold Steady at 1,815 – Symmetrical Triangle Remains Intact
Gold prices closed at $1,814.60, after setting a high of $1,817.20, and a low of $1,789.10. Gold reversed its course on Tuesday, and started recovering some of its losses of the previous session, despite the rising strength of the dollar and higher treasury yields. The US Treasury yield, on the benchmark 10-year note, surged continuously on Tuesday, reaching 1.68%. However, after reaching this level, yields fell and it closed at 1.64%. On Tuesday, the decline in yields may have aided the rise in the prices of the yellow metal. Meanwhile, the US Dollar Index, which measures the greenback’s value against a basket of six major currencies, rose to 96.26 on Tuesday. The rising strength of the dollar failed to reverse the increased prices of gold.
Gold Rate Live
The US dollar index rose on Tuesday, despite the release of unfavorable macroeconomic data. At 20:00 GMT, the ISM Manufacturing PMI dropped to 58.7, from the projected 60.0, and weighed on the dollar. The JOLTS job openings also fell to 10.56 million, compared to the expected 11.06, weighing on the US dollar. The ISM Manufacturing Index fell to 68.2, against the predicted 79.3, further weighing the US dollar. All the data released on Tuesday was unfavorable for the local currency, hence, the increase in the precious metal.
Another reason behind the surge in gold prices could be the rising safe-haven demand boosted by worries over a massive increase in the number of coronavirus cases due to the Omicron variant, which now threatens global economic recovery. The United Kingdom recorded about 218,724 coronavirus cases on Tuesday, the highest daily total since the pandemic started.
The US Centers for Disease Control and Prevention published data on Tuesday, estimating that the Omicron variant caused about 95% of new infections in the country. Meanwhile, a vaccinologist from the University of Michigan has said that countries cannot continue to immunize every three months and should allow the vaccines to work.
Furthermore, the latest reports from France have revealed that French scientists have identified a new COVID-19 variant with 46 mutations, which is even more than the highly contagious Omicron variant. The variant has been named Ihu, and so far, 12 people in southeastern France have been infected with this new variant. With the world already facing Omicron, a new variant adds to the concerns and this raised the safe-haven appeal, pushing gold prices higher on Tuesday.
Regardless of rising Treasury yields, the precious metal remained higher onboard, amid the improved risk-off market sentiment, driven by the discovery of a new variant of the coronavirus, named Ihu.
Daily Technical Levels
Support Resistance
1,802.74 1,821.84
1,790.87 1,829.07
1,783.64 1,840.94
Pivot Point: 1,809.97
Gold (XAU/USD) – A Technical Outlook; Upward Trendline to Support at $1,797
Gold is trading with a slightly bullish bias at the 1,815 level, heading towards 1,818. Violation of the resistance level could expose the precious metal to the 1,832 resistance zone. On the lower side, the next support can be found at around 1,809, prolonged by the pivot point level. The closing of candles above the support level of 1,809 suggests chances of an uptrend in gold. A bearish break below the 1,809 level would expose gold to 1,800. There appears to be a bearish bias below 1,809 and vice versa. Good luck!
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