Gold: Bull breakout remains elusive as Treasury yields spike
- Gold struggles to find acceptance above $1,350.
- USD better bid, tracking a rise in the treasury yields.
Gold (XAU/USD) faded spike to $1,354 yesterday as the rise in the treasury yields put a bid under the US dollar.
As of writing, the yellow metal is changing hands at $1,342/Oz, representing a 0.30 percent drop on the day. Meanwhile, the dollar index (DXY) has hit an 11-day high of 89.74.
The US two-year treasury yield rose above 2.4 percent yesterday and extended gains further to 2.44 percent in Asia - its highest level since September 2008. Further, the 10-year treasury yield moved above 2.9 percent and looks set to scale the 3 percent mark soon.
Hence, the dollar may remain well bid against the zero-yielding safe haven yellow metal.
Gold Technical Levels
The bull flag breakout (close above $1,350) pattern has failed twice in the last ten days. So, the emboldened bears may push the metal down to $1,337 (ascending trendline support). A violation there would expose support lined up at $1,331 (50-day MA) and $1,329 (100-day MA).
On the higher side, the key levels to watch out for are: $1,355 (weekly high), $1,357 (March 27 high) and $$1,365 (April 11 high).