Financial analyst Vijay Valecha said pressure on gold eased after Treasury yields cooled following their recent spike, explaining that the bullion typically comes under pressure when yields rise
Gold prices continued its rebound on Tuesday morning amid lower oil prices and a subdued dollar easing inflation and rate-hike concerns.
The 24K variant was trading at Dh523.25 per gram at the open of the market on Tuesday, according to data by Dubai Jewellery Group. The other variants, 22K, 21K, 18K, and 14K, were trading at Dh484.75, Dh464.75, Dh398.25, and Dh310.75 per gram, respectively.
Globally, spot gold was trading at $4,346.5 per ounce, up 0.01 per cent as of 9:12am UAE time. Silver was also up at 0.29 per cent, trading at $66.09 per ounce.
Financial analyst and CIO of Century Financial Vijay Valecha said pressure on gold eased after Treasury yields cooled following their recent spike, explaining that the bullion typically comes under pressure when yields rise.
“Oil has fallen for a third straight day on easing Middle East supply disruptions, reinforcing the disinflationary tailwind for gold,” he said, adding that gold-backed ETFs have seen inflows for eight consecutive days even through recent price weakness, pointing to strong underlying investor conviction.
He added, “If rising yields prove to be driven more by fiscal concerns than rate expectations, a weaker dollar could keep the broader setup supportive for bullion. Structural drivers, rising fiscal deficits, higher debt burdens, and an eventual dollar-easing cycle, continue to underpin the medium-term bullish case, with pullbacks seen as buying opportunities.”
On the technical side, the analyst said that gold has reclaimed its short-term trendline and is testing resistance at $4,431–4,434; a close above this zone would open the way toward $4,510, then $4,573. “Support lies at $4,385, then $4,340, and a bounce off this zone keeps the near-term structure constructive. A buy-on-dips approach toward support is favoured while price holds above $4,340, with a break above $4,434 confirming a shift back toward the broader uptrend,” he explained.
Silver, on the other hand, is tracking gold’s rebound and headed for a weekly gain, supported by the same disinflationary and dollar-driven tailwinds.
Source: Khaleejtimes
