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Key Support Eyed Ahead Of Fedspeak; Ukraine Escalation Risk Put Away For Now

GOLD

Gold trades ~$6/oz higher, printing $1,860/oz at writing. The precious metal has risen a little above Monday’s worst levels at writing catching a bid as nominal U.S. Tsy yields continue to trade around the bottom of their respective ranges on Monday.

  • To recap Monday’s price action, gold closed ~$30/oz lower, hitting one-week lows as U.S. real yields broadly moved higher by the session’s end, while the USD (DXY) was little changed on the day after backing away from fresh 20-year highs.
  • Looking to Russia, Putin’s Victory Day speech made on Monday overall showed no indication of meaningful escalation in the Russia-Ukraine war, easing prior worry from some quarters re: a wider conflict. Defence analysts have however highlighted significant unresolved issues such as an “off-ramp” for Russia to de-escalate, as well as the lingering possibility of escalation in the coming weeks given the plausibly inconvenient timing (May is a traditional Russian holiday period).
  • A note that a packed Fedspeak slate is due later today from the likes of Williams (voter), Barkin (‘24), Waller (voter), Kashkari (‘23), and Mester (‘24).
  • From a technical perspective, gold remains vulnerable after moving below support at the 50-Day EMA, and trades a short distance away from support at $1,848.8/oz (76.4% retracement of the Jan28-Mar8 rally). On the other hand, resistance sits at $1,909.8/oz (May 5 high).
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Gold trades ~$6/oz higher, printing $1,860/oz at writing. The precious metal has risen a little above Monday’s worst levels at writing catching a bid as nominal U.S. Tsy yields continue to trade around the bottom of their respective ranges on Monday.

  • To recap Monday’s price action, gold closed ~$30/oz lower, hitting one-week lows as U.S. real yields broadly moved higher by the session’s end, while the USD (DXY) was little changed on the day after backing away from fresh 20-year highs.
  • Looking to Russia, Putin’s Victory Day speech made on Monday overall showed no indication of meaningful escalation in the Russia-Ukraine war, easing prior worry from some quarters re: a wider conflict. Defence analysts have however highlighted significant unresolved issues such as an “off-ramp” for Russia to de-escalate, as well as the lingering possibility of escalation in the coming weeks given the plausibly inconvenient timing (May is a traditional Russian holiday period).
  • A note that a packed Fedspeak slate is due later today from the likes of Williams (voter), Barkin (‘24), Waller (voter), Kashkari (‘23), and Mester (‘24).
  • From a technical perspective, gold remains vulnerable after moving below support at the 50-Day EMA, and trades a short distance away from support at $1,848.8/oz (76.4% retracement of the Jan28-Mar8 rally). On the other hand, resistance sits at $1,909.8/oz (May 5 high).