Gold Market Under Pressure As Yields Rise
Gold extended losses as US Treasury yields resumed their climb, pressuring non-yielding bullion even as the US Dollar softened ahead of inflation data. XAU/USD traded at $4,157, down 0.37%, after failing again to hold above $4,200 and sliding to a fresh weekly low of $4,150. The US 10-year yield rose 6 basis points to 5.223% while energy prices advanced, with WTI up more than 1% at $94.20; by contrast, the Dollar index fell over 0.32% to 102.24 as its usual correlation with oil weakened. US data were mixed: the ADP Employment Change four-week average eased from 25.25K to 24.75K, while Existing Home Sales Change rose 1.5% MoM, reversing August’s -3.2%, and sales edged up from 3.93 million to 3.99 million.
Geopolitical Risks And Central Bank Activity
Geopolitical risks remained centred on the Strait of Hormuz, with shipping traffic reported near 80% of pre-war levels, while US and Fed commentary kept markets focused on inflation persistence. Derivatives pricing implied a 23% chance of a 25 basis point Fed hike at the 27–28 October meeting. Attention turns to Wednesday’s CPI, Thursday’s PPI and remarks from Fed Chair Kevin Warsh. Technically, the RSI stayed below 50, with support at $4,150 then $4,100, followed by $4,050 and the 29 July cycle low of $3,996 near $4,000; resistance sits at $4,200, then the 100-day SMA at $4,252, the 50-day SMA at $4,339 and $4,500, ahead of the 200-day SMA at $4,522. Central banks remain key holders, having added 1,136 tonnes worth about $70 billion in 2022.
