XAU/USD gold futures recorded small gains yesterday, rebounding to the $1750 level, recovering from a decline towards the $1732 level.
- XAU/USD gold prices are unable to benefit from the weakness of the US dollar and the drop in Treasury yields.
- The yellow metal has struggled for most of 2022, although it found some silver linings in the possibility of the Fed stopping the tightening cycle next year and possibly even cutting prices.
- XAU/USD gold price is settling around $1738 an ounce at the time of writing.
- In general, gold prices are on track to achieve monthly gains, but they are still down by about 4.9% since the beginning of the year 2022 to date.
In the same performance, silver, the sister commodity to gold, topped the $21 an ounce level on Tuesday. Accordingly, the white metal is on track to achieve a monthly gain of around 10%. So far this year 2022, the price of the white metal has fallen by nearly 10%. Gold and silver prices are trying to range bound now that the US dollar has stalled after peaking earlier this month.
The US Dollar Index (DXY), which tracks the greenback's performance against a basket of major currencies, fell to 107.47 from an opening of 107.84. The index decreased by 3% on a monthly basis, but increased by 12% year-to-date in 2022. A weaker US dollar is beneficial for dollar-denominated commodities because it makes it cheaper for foreign investors to buy them.
Other Factors Affecting Gold
US Treasury yields were mixed, with the benchmark 10-year yield falling 5.4 basis points to 3.769%. The one-month yield fell 1.8 basis points to 3.856%, while the 30-year yield fell 6.5 basis points to 3.842%. The spread indicating recession between 2-year and 10-year yields widened to negative 77 basis points.
Economic Outlook
The situation was relatively muted, with the Richmond Fed's Manufacturing, Shipping, and Services indices remaining in negative territory. On Wednesday, housing, durable goods orders, and PMI data will be released ahead of the Thanksgiving holiday. Investors will also comb through the minutes of this month's Federal Open Market Committee (FOMC) meeting.
In other metals markets, copper futures rose to $3,622 a pound. Platinum futures traded to $1,000.80 an ounce. Palladium futures rose to $1,860.50 an ounce.
XAU/USD gold price forecast today:
According to the performance on the daily chart below, the XAU/USD gold price is at the beginning of breaking the general bullish trend. This may happen if prices move towards the support levels of $1728 and $1710, respectively. On the other hand, and over the same time period, the bulls' move towards the resistance level at $1775 an ounce will be important for an upward path for a while. I still prefer to sell gold from every level up. It must be taken into account that today's trading session is important and crucial for the gold market, ahead of a long American holiday that affects the liquidity of the markets.
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