Key Insights
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Gold prices fell as the dollar rose.
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US wholesale inventories increased by 2.3% in March.
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Treasury yields climb to the highest levels since 2018.
Gold prices fell despite spiraling inflation and declining economic growth. The dollar rose against other major currencies. Benchmark yields continue to soar as the ten-year treasury yield rallied to 3.185% in the wake of the Fed tightening rates.
US wholesale inventories rose 2.3% in March compared to the previous month, which was in line with economists’ expectations. Wholesale inventories increased 22% year-over-year. Inventories are a part of gross domestic product and go into the GDP calculation.
Inflation data that will be released on Wednesday will likely signal the size of the Fed’s next move.
Technical Analysis
Gold prices faced downward pressure and are on track to break below the 200-day moving average of 1836. Support is seen near the 200-day moving average at 1,836. Resistance is seen near the 10-day moving average of 1,882.
Short-term momentum is negative as the Fast Stochastic generated a crossover sell signal. Prices are oversold as the fast stochastic prints a reading of 13.5 below the oversold trigger level of 20.
Medium-term momentum has turned negative as the MACD generates a crossover sell signal. This occurs as the 12-day moving average minus the 26-day moving average crosses below the 9-day moving average of the MACD line. The MACD (moving average convergence divergence) histogram has a negative trajectory that points to lower prices.
This article was originally posted on FX Empire
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