FxWirePro:Gold trades higher on global growth concerns, good to sell on rallies

Gold has recovered slightly more than $25 amid strong US dollar index. The yellow metal has lost more than $80 from high of $1341 made on Feb 20th 2019 on account of strong global markets and easing US-Sino trade tensions.

US dollar Index: Bullish. DXY has shown a minor decline after hitting high of 98.31. Overall trend is bullish as long as support 97.50 holds. The index has formed a double bottom around 96.75` and any minor weakness only below that level.It is currently trading around 98.15. (negative for gold).

USD/JPY: Strong . USD/JPY has lost nearly 80 pips after hitting high of 112.16 level.The near term resistance is around 112.20 and any break above will take the pair to next level till 112.60/113.Negative for gold.

 US 10 year yield : US 10 year yield lost more than 3.5% from high of 2.615%.In short term yield has jumped more than 11% from 14-month low of 2.34%. Overall it has been trading weak for past four months and lost nearly 25% from high of 3.25%.It is currently trading around 2.536%. Slightly positive for Gold.

 US 2 year yield: It is trading around 2.33%. The spread between US 10 year and 2 year has declined to 20bpbs from 30 basis point. The spread between 3 month and 10- year yield  inversion has reversed (US 10 year yield trading above US 3 month).

Gold technical

On the higher side, near term resistance is around $1281 and any convincing break above targets $1286/$1292. The yellow metal should break above $1292 for further bullishness.

The near term support is around $1266 and any break below will drag the commodity down till $1261/$1251.

It is good to sell on rallies around $1277-80 with SL around $1285 for the TP of $1261/$1251.