$1,720 Proving Hard To Break Amidst Still-High Yields, Dollar

Gold sits just shy of Wednesday’s best levels, dealing $2/oz weaker to print $1,716/oz at typing as the USD and nominal U.S Tsy yields have largely stemmed their slides.

• To recap, the precious metal closed $16 firmer on Wednesday, rising by the most in over a month amidst a pullback in the USD (DXY) and U.S. real yields from their recent, respective highs.
• A BBG report has pointed to a sharp rise in gold’s inverse correlation coefficient with the USD, suggesting more “pain” ahead for bullion in the case of continued Dollar strength.
• From a technical perspective, gold remains in a clear downtrend after its recent breach of support at $1,727.8 (Aug 22 low) reinforced bearish conditions. Initial support is seen at $1,681.0 (Jul 21 low and bear trigger), with resistance located at $1,726.7 (6 Sep high).