Gold price has lost its traction and erased a large portion of it daily gains after having climbed to a fresh weekly high near $2,030 on Wednesday. The benchmark 10-year US Treasury bond yield recovered above 3.4% following the sharp decline seen after US CPI data, limiting XAU/USD’s upside.
Gold price reverses the previous week’s pullback from an 11-week-old ascending resistance line as it bounces off the 10-DMA support.
The precious metal’s recovery also takes clues from the upbeat RSI (14), not overbought, while paying little heed to the sluggish MACD signals.
With this, the XAU/USD is well-set to poke the multi-day-old resistance line, around $2,038 by the press time. However, the RSI may turn overbought at that level and can challenge the Gold buyers afterward.
If not then, a gradual run-up toward the previous yearly high of around $2,070 can’t be ruled out.
Alternatively, a downside break of the 10-DMA support level of $1,996 isn’t an open invitation to the Gold sellers as an upward-sloping support line from March 22 joins a two-month-old horizontal line to highlight $1,960-57 zone as a tough nut to crack for the XAU/USD bears.
Overall, the Gold price is likely to remain firmer even if the upside room appears limited.