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Gold is trading below $ 1,700

On Wednesday, in Asia, gold continued to move down due to strengthening dollar and rising yields of US Treasuries.

 

The day before, the yield on 10-year government bonds rose to a new 14-month high of 1.776%. After a slight pullback today, the yield on long-term US government bonds began to rise again, providing additional support to USD. Today, the dollar index reached a new high in almost 5 months of trading. Gold remains closely inversely correlated with these instruments.

 

Investors are now awaiting the release of the US employment report, which will be released on Friday. There is a growing market expectation that the main indicators of the labor market will improve. Later today, ADP is to publish data on changes in the number of employees in the nonfarm sector, which may correct investors' expectations regarding Friday's report. The indicator is projected to grow from 117 thousand to 550 thousand.

Other precious metals are demonstrating multidirectional trading dynamics today. Palladium rose by 1.6%, while patina rose by 0.8%. Silver prices declined by 0.5%.

 

On the chart, the price is testing the level of 1680.00. This is a fairly strong support level, so a rollback movement can be expected from it, but the trend remains a priority for the bears in the medium term.

 

  • Resistance levels: 1700.00, 1713.00, 1723.00.00.

 

  • Support levels: 1680.00, 1665.00, 1650.00.

 

The main scenario is a correction to 1700.00 and a decline below 1680.00.

 

An alternative scenario is a decline below 1680.00 from current levels.

 

The current fundamental background is negative. Within the daily framework, we still prioritize shorts with entry points on the price rollback to the levels of 1700.00 and 1713.00.

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