Gold Price Forecast: XAU/USD rebounds to $1850 despite higher US yields
- Stocks reverse in Wall Street, Dow Jones down by more than 1%.
- US economic data surpass expectations.
- XAU/USD faces resistance around the $1850 area.
Gold prices bounced from multi-day lows under $1830 to the $1850 area after the beginning of the American session and despite higher US yields. XAU/USD holds near daily highs even as Wall Street extends losses and as the US dollar strengthens.
Earlier on Wednesday gold prices rose sharply finding resistance under $1850. After a pullback to $1838 following the release of better-than-expected US economic, prices turned again to the upside. As of writing, XAU/USD stands at $1849, fresh daily high.
The positive momentum for gold remains intact even despite the negative context for the metal. The US 10-year yield stands at weekly highs at 2.93%. The US dollar trades at daily highs across the board. The DXY is up by 0.80% above 102.55.
The positive US ISM Manufacturing report triggered a decline in equity prices as the figures reinforced expectations of aggressive monetary policy tightening from the Federal Reserve.
Silver is rising by 1.45%, erasing most of Tuesday’s losses. XAG/USD bottomed at $21.44 during the European session and recently peaked at $21.97.
Wednesday’s rally in metal could turn into a reversal if gold manages to break and hold above $1850 and silver does the same with $22.00.
Technical levels