Gold falls by 0.8% to $1,847 and erases the gains from yesterday
A bit of a troubling moment for gold buyers before the weekend perhaps?
The drop in European morning trade today could be hinting at a reversal of the technical breakout after the US CPI data on Wednesday.
As mentioned several times since then, I'm not one that is too convinced of the latest breakout in gold even if the yellow metal managed to outperform despite a stronger dollar.
Bond yields are keeping higher once again today with the front-end running; US 2-year yields up over 4 bps to 0.545% and 10-year yields up over 2 bps to 1.580%.
The key level to watch for gold now is whether or not it can hold any retreat back towards the highs seen in the summer around $1,832-34. Keep above that and buyers still stand a shot at building back some upside momentum moving forward.
As also pointed out previously this week, I'd be more of a fan of gold upside if the technical breakout lines up with the December to January seasonal tailwind. So, the latest push is coming a bit early for my liking but we'll see if buyers can maintain some appetite before capitalising on the seasonal tailwind heading into year-end.
