Ichimoku Analysis (4-Hour chart)
Tenken-Sen- $1955.03
Kijun-Sen- $1960.85
Gold prices lost their shine and lost more than $30 from a minor top of $1970.25. The unexpected 25 bpbs rate hike by the Bank of Canada pushed US treasury yields prices higher. It hits a low of $1939.94 yesterday and is currently trading around $1946.67.
US dollar index- Bullish. Minor support around 102.30/101.50. The near-term resistance is 104.40/105.
According to the CME Fed watch tool, the probability of a 25 bpbs rate hike in June increased to 33.3% from 21.8% a day ago.
The US 10-year yield surged more than 4% on rate hike hopes. The US 10 and 2-year spread narrowed to -82.9% from -76.90%.
Factors to watch for gold price action-
Global stock market- bullish (negative for gold)
US dollar index - Bullish (negative for gold)
US10-year bond yield- Bullish (Bearish for gold)
Technical:
The near–term support is around $1935, a break below targets of $1920/$1900.The yellow metal faces minor resistance around $1965, and a breach above will take it to the next level of $1980/$2000/$2020/$2040/$2070/$2100/$2150.
It is good to sell on rallies around $1970 with SL around $1980 for TP of $1920/$1900.
