Gold Price Retreats from Record Highs as US Dollar and Yields Rebound

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Gold price (XAU/USD) fell sharply from fresh all-time highs around $2,220 after a strong rebound in the US Dollar (USD) and US Treasury yields.

Key Factors:

  • US Dollar Rebound: Upwardly revised forecasts for US GDP and Core PCE in 2024 limited the USD’s downside, fueling the rebound.
  • Rising Yields: Rebounding 10-year US Treasury yields to 4.27% reflect the unchanged Fed outlook on rate cuts, pressuring non-yielding Gold.
  • Fading Rate Cut Hopes: Fed Chair Powell’s comments on easing inflation temper expectations for a June rate cut, diminishing the appeal of Gold.

Technical Outlook:

  • Record Highs Retreat: Gold price dips below $2,180 after surging to a new all-time high near $2,220.
  • Bullish Momentum: While short-term sentiment remains strongly bullish with the 20-day EMA sloping upwards, Gold may encounter resistance near $2,250 (161.8% Fibonacci extension).
  • Key Support: The December 4 high at $2,144.48 offers a critical support level for Gold bulls.
  • RSI Indicator: The Relative Strength Index (RSI) remains in the bullish range, suggesting potential for further upside.

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