The precious metal has suffered significant losses since late October, exacerbated by the victory of Donald Trump in the US presidential election. Concurrently, 10-year Treasury yields have risen sharply, approaching 4.5%. The US dollar has also strengthened, with the EURUSD pair touching 1.05.
Interestingly, gold is rebounding today, despite a persistent strong dollar and rising yields. Globally, there are reports of heightened gold demand in India, particularly during the wedding season. Conversely, Chinese jewelry demand has contracted at a double-digit pace since the year began.
Since the US election, gold's decline has been limited to 5%. Historically, post-US election corrections in gold prices have typically lasted 20-30 sessions.
The latest positioning data continues to show a reduction in net long positions, reaching their lowest level since the summer.
Today's 1.5% rebound in gold is part of a broader rally in precious metals. The yellow metal is bouncing off a key support level formed by the 50% Fibonacci retracement of the most recent major upward wave and the 100-period moving average. Seasonality suggests that the downtrend may be nearing its end in late November. However, resistance around $2,600 and a position below the upward trendline established after this year's lows continue to cap gains.
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