FxWirePro: Gold declines sharply on strong US 10-year yield, good to sell on rallies

• Gold prices declined sharply after making a high of $1313.40 on Sep 26th 2017.  The yellow metal has broken the low of $1288 made on Sep 21st 2017 and declined till $1280.11 at the time of writing on account of rising expectations of year end hike and Trump’s tax plan. It is currently trading around $1280.94 0.19% lower.
   
• The framework proposed by Donald Trump and Republicans shows that tax on corporates reduced to 20% from current rate of 35%. The number of tax brackets are reduced from 7seven to three for individuals.  The new bracket would be 12%, 25% and 35%, with top rate down from 39.5%.
   
• US Dollar index has shown a major recovery and broken major resistance at 55- day EMA and closed slightly above that level. The pair has broken trend line resistance in the Asian session and a jump till 94.15 is likely strong resistance at 93.35 and any break above will take the index to next level till 94.15. The index’s near term support is around 93.30 and any close below will drag the down till 92.35 (daily Kijun-Sen).
   
• U.S 10 year yield up more than 8 basis point after US president Donald Trump tax reform .
   
• Technically gold is facing minor resistance around $1292 (55- day EMA) and any break above will take the yellow metal till $1303 (10- day MA)/$1315.45 (daily Kijun-Sen).
   
• Gold’s near term support is around $1280 (50% retracement of $1204 and $1357.90) and break below will drag the commodity down till $1267 (.The yellow metal should break below $1250 for major trend reversal. 

It is good to sell on rallies around $1282-84 with SL around $1292 for the TP of $1267/$1250.