Daily Times

Gold prices came under renewed bearish pressure on Tuesday, extending the previous day’s retracement slide from the vicinity of the $2,000 psychological mark, amid rising US Treasury bond yields and strengthening dollar.

As of 1410 hours GMT, gold in the international market was available at $1,961 per ounce, shedding $17.70 (-0.89 percent). Out of the $17.70 per ounce decrease, -$1.75 was due to strengthening of the US dollar and -$15.95 was due to predominant sellers, according to Kitco Gold Index.

The price of 10 grams of 24-carat yellow metal in Pakistan, meanwhile, decreased to Rs114,500 after shedding Rs2,000. Gold price in the local market settled at Rs116,500 on Monday last.

According to experts, gold price remains at the mercy of the price action in the US dollar and the bond yields. Gold extended the previous day’s retracement slide from the vicinity of the $2,000 psychological mark and witnessed some selling on Tuesday. The intraday downfall picked up pace during the early session and dragged spot prices to a four-day low, around the $1,957. The US dollar stood tall near its highest level since April 2020 and continued drawing support from expectations for a more aggressive policy tightening by the Federal Reserve.

The markets have been pricing in multiple 50bps rate hikes by the Fed. This, along with concerns that the worsening Ukraine crisis would put upward pressure on already high inflation, remained supportive of elevated US Treasury bond yields. The combination of factors overshadowed worries about the economic fallout from a protracted Russia-Ukraine war and weighed on the precious metal.

From a technical perspective, the bulls need a decisive close above $1,982, the previous week’s high. Acceptance above this level is critical to resume the uptrend towards the previous day’s high of $1,998.

On the flip side, the gold price enjoys strong support at $1,957, which is the day’s low. Next support level lies around $1,945. A daily closing below $1,945 could negate prospects for any further near-term appreciating move.