Gold Technical Analysis: Bulls Looking for a Breakout as DXY Stays Firm

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EnclaveFX
Aug 03, 2022
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The gold price is pressured in Asia, falling 0.2% to a low of $1,756.19 from a high of $1,762.07 in the session so far. US bond yields had been waning in the wake of a less hawkish narrative surrounding the Federal Reserve which has been beneficial for the gold price.

However, US yields have rallied recently weighing on the gold price. The yield on the US 10-year note was last seen trading at 2.748 % after recovering from the lowest since early April and at the bottom of a daily broadening formation's daily range. Meanwhile, the US dollar rose off the lowest in nearly a month early on Tuesday, with the DXY index last seen up 0.10% to 106.445.

Technically looking at the H4 and Daily charts the yellow metal is in an upward channel given the recession fears. The only warrant for Bulls would be a stronger posting in the NFP release this Friday and a firmer dollar. Currently the price has faced rejections from the $1790 levels with tensions rising between US and China. But a breakout from $1790 could expose the psychological $1800 figure. On the flip side with a firmer DXY across the board, the XAU/USD pair is well supported at the lower levels of $1760 and $1750.