FXStreet (Mumbai) – Gold prices on Comex extends its bearish tone and tested the crucial support at 1080 levels on yet another occasion on Tuesday, as the persistent US dollar strength across the board on rising expectations of Fed rate-hike this Sept continues to pressure the yellow metal.
Gold capped at 1084.50
Currently, gold trades -0.52% lower at 1083.70, receding slightly from session lows posted at 1080.30. Gold dropped for the second day in a row as markets continue to talk up Sept Fed rate lift-off bets which continue to boost the shorter duration treasury yields, weighing on non-interest bearing gold prices. The yields on the 2-year treasury notes trades 1.73% higher at 0.677%.
Meanwhile, the US dollar index, a virtual gauge of greenback’s strength, now trades 0.05% higher at 97.65. A stronger greenback makes dollar-priced in gold more expensive to holders on other currencies and vice-versa.
Moreover, gold prices failed to find support in downbeat US factory data released on Monday and remained entrenched in the two-week range at the beginning of the new month following massive losses in early July, as traders now focussed on the Federal Reserve policy outlook.
Markets now await US factory orders data which may provide further incentive on the USD moves in the day ahead.
Gold Technical Levels
The metal has an immediate resistance at 1090 and 1098 levels. Meanwhile, support stands at 1080 below which doors could open for 1073.70 levels.
(Market News Provided by FXstreet)