Gold is trading flat after a good recovery of more than $10 easing US 10 year bond yield.It is currently trading around $1224.85.
The major three factors that drive gold prices
US dollar Index: Weak. DXY has lost more than 0.8% from high of 97.54.It is consolidating after hitting low of 96.63.The index’s previous high is around 97.69 and any further bullishness only above that level.It is currently trading around 96.76.The near term support is around 96.70 (20-day MA) and any convincing break below targets 96. (Positive for gold).
USD/JPY: Slightly weak. The pair has lost more than 80 pips from high 114.03. It is currently trading around 113.38. The near term support is around 113 and any break below targets 112/11.37. Slightly negative for gold.
US 10 year yield : US 10 year yield is trading slightly lower and lost more than 2% after Powell’s speech .It has declined slightly below 3%.Any further weakness only if it breaks convincingly below 3.00%. It is currently trading around 3.028%. Positive for Gold.
US 2 year yield: It has taken support near 89-day EMA and shown a marginal higher. The spread between US 10 year and 2 year has decreased from 30bpbs to 22 bpbs.
Gold technical
Major support $1183
Major resistance - $1240
The yellow metal has shown a minor decline after hitting high of $1228.86.On the higher side, major resistance is around $1230 and any convincing break above $1230 will take the commodity till $1236. It should break above $1243 (Oct 26th 2018 high) for bullish continuation.
The near term support is around $1217 (55 day EMA) and any violation below will drag the commodity down till $1209/$1200.
It is good to buy on dips around $1222-23 with SL around $1217 for the TP of $1243.


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