Gold Price Fades as Oil Prices Rise, US Yields Remain High
The XAU/USD is trading at $4,367 after bouncing from its lows of $4,324. This moderate increase comes amidst broad-based USD weakness ahead of the release of the Fed minutes.
According to analysts at OCBC, 'gold's rebound has lost some momentum as the renewed rise in oil prices added to pressure from higher long-end US yields.' They affirm that 'for the gold rally to regain traction, oil and yields need to stabilise, or a stronger pickup from investment demand,' suggesting near-term performance will hinge on whether inflation-related drivers and investor flows turn more supportive.
The technical picture hints at fading bullish momentum, with Tuesday's bearish engulfing candle in the daily chart being a bearish sign that hints at a potential trend shift. Momentum indicators remain in bullish territory but highlight a waning impetus, with the Relative Strength Index (RSI) pulling back below 60 and the Moving Average Convergence Divergence (MACD) histogram showing contracting bars.