Gold Retreats from Three-Month High as Traders Book Profits
Gold prices have retreated from their three-month high of $4,697 after setting a fresh record earlier in the day. Traders are booking profits following the recent rally, which has pushed the Relative Strength Index (RSI) into overbought territory.
The US Dollar's modest recovery also limits demand for the USD-denominated metal. However, strong support is coming from developments in the US bond market, with analysts noting that the stepped-up buying of Treasury bonds 'has lit a fire under gold and silver.'
According to TD Securities, this trend may continue as worries about America's fiscal situation are resurrecting the USD debasement narrative, which is energizing gold bugs. Meanwhile, demand for Gold-backed exchange-traded funds has strengthened in the previous week.