FxWirePro: Gold declines sharply on easing US-Iran tensions, good to buy on dips

Ichimoku Analysis (Daily chart)

Tenken-Sen- $1566.46

Kijun-Sen- $1548.74

Gold has lost more than $30 after hitting a 6-year high yesterday due to the escalation of US-Iran tension. The top Iranian military commander killed by a US drone strike and Iran vows to take revenge. The government clearly stated that it will no longer abide by key terms of the 2015 nuclear deal. The yellow metal hits low of $1555 and is currently trading around $1563.

US 10- year bond yield has halted its 3 days of losing streak and jumped nearly 3.5% from low of 1.76%. The spread between US 10 and 2-year has slightly narrowed to 26 bps from 35 bps.

The pair hits 6-month high at $1588 and any break above targets $1600/$1625. On the flip side, nearby significant support is around $1524 (5- day MA) and any violation underneath will drag the gold down till $1507/$1470.

It is good to buy on dips around $1550-55 with SL $1540 for the TP of $1600.