Gold's Temporary Reprieve Masks Downtrend Pressure

Gold prices have been consolidating after a relatively quiet week of trading, but experts warn that this pause may be temporary. The World Gold Council notes that rising US real and bond yields, as well as a strengthening US dollar, are weighing on bullion.

The yellow metal has been trading above the June low of $3,943/oz, with the London Bullion Market Association (LBMA) gold price Post-Meridiem (PM) surging 1.8% to $4,067/oz last week. However, this rebound may be a temporary breather in gold's downtrend that has been in place since January.

From a technical perspective, the next key support level for gold is at $3,857-3,887/oz. Meanwhile, there are high expectations from the US Federal Reserve to keep interest rates unchanged this week.