Bouncing From Lows

Gold sticks within the boundaries set in recent sessions with bulls finding support around $2,020/oz, with a quick bounce back towards $2,030/oz seen as the USD rally stalls.

• The higher U.S. Tsy yield, higher USD, strong data combo had weighed.
• Familiar initial lines of support (Feb 5 low at $2,015.0/oz) and resistance (Feb 1 high at $2,065.5/oz) remain untouched.
• ETF holdings of gold continue to fall (hitting the lowest level since Jan ’20), while Chinese official holdings continue to swell.
• Looking ahead TD Securities note that “a record pace of central bank physical gold purchases and renewed investor interest to protect against purchasing power erosion, default risks as US debt grows to alarmingly high levels and sanctions risks associated with geopolitical tensions in the Middle East and Eastern Europe, could all be factors that not only provide price support as they did last year, but augment any spec-driven rally.”