Ichimoku Analysis (4-Hour chart)
Tenken-Sen- $2014.49
Kijun-Sen- $2040.52
Gold prices trade higher above $2025 on US default fears. US Treasury Secretary Janet Yellen warned that a "constitutional crisis" would happen if the debt ceiling was not increased. It hits a high of $2029.40 and is currently trading around $2025.24.
US dollar index- Bearish. Minor support around 100.80/100. The near-term resistance is 101.60/102.40.
According to the CME Fed watch tool, the probability of a no-rate hike in June increased to 86.90% from 64.6% a week ago.
The US 10-year yield gained more than 6% from the minor bottom of 3.298%. The US 10 and 2-year spread narrowed to -48% from -108%.
Factors to watch for gold price action-
Global stock market- bullish (negative for gold)
US dollar index - Bearish (positive for gold)
US10-year bond yield- bearish (positive for gold)
Technical:
The near–term support is around $2000, a break below targets of $1970/$1955/$1935.The yellow metal faces minor resistance around $2070, and a breach above will take it to the next level of $2100/$2150.
It is good to buy on dips around $1970 with SL around $1950 for TP of $2070/$2100.
