On Tuesday, the price of gold rallied amid a weakening dollar and declining yields in US Treasuries.
Despite the publication of stronger-than-expected data on the labor market and other factors of economic recovery (strong data on PMI of the non-manufacturing and services sectors), the US dollar is under pressure. The dollar index fell to 7-day lows.
The downward dynamics of the movement is also demonstrated by the yield of the American Treasuries. The 10-year yield curve dipped below 1.7%, moving away from its recent multi-month high by 1.776%.
Gold maintains a very close inverse correlation with these instruments, so today it is showing a good upward trend. Following gold, prices of other metals also rise. Silver is up by 0.9%, platinum is up by 0.6% and palladium is trading at Monday's closing price level.
There is no important news in the economic calendar today. The main benchmark for gold will remain the US dollar and the dynamics of the movement of the yield curve of long-term US debt.
Buyers managed to gain a foothold above the level of 1722.70. This is a good signal for the continuation of the upward movement towards the level of 1753.50.
The main scenario is growth towards the level of 1753.50.
An alternative scenario is a breakdown of the support at 1722.70 and a decline to 1706.50.
The current fundamental outlook is moderately positive. We are considering longs from the level of 1722.70.
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