7 May 2015
Gold recovers losses
FXStreet (Mumbai) - Gold prices recovered from the low of USD 1178.6/OZ, tracking the sudden decline in the US Treasury yields despite of a better-than-expected jobless claims data.
Gold recovers post jobless claims losses
The metal had dipped to a low of USD 1178.6 after the labor department data showed the initial jobless claims increased by 3,000 to 265,000 in the week ended May. The actual figure was smaller than the consensus estimate of 278K. The four-week average of claims, which provides a more accurate picture of the labor market strength, dropped to 279,500, the least since May 2000.
However, the metal managed to bounce back as the 10-year Treasury yield fell to 2.202%, down 3.8 basis points for the day. Gold and long end bond yields are known to have an inverse relationship. Meanwhile, signs of weakness in the US equity markets also helped the safe haven metal recover losses.
Gold Technical Levels
The metal currently trades at USD 1186.4/Oz. The immediate resistance is located at 1190.25 (50-DMA), above which gains could be extended to 1199.5. On the flip side, a break below 1184.00 could drive the metal back to its daily low of 1178.6.
Gold recovers post jobless claims losses
The metal had dipped to a low of USD 1178.6 after the labor department data showed the initial jobless claims increased by 3,000 to 265,000 in the week ended May. The actual figure was smaller than the consensus estimate of 278K. The four-week average of claims, which provides a more accurate picture of the labor market strength, dropped to 279,500, the least since May 2000.
However, the metal managed to bounce back as the 10-year Treasury yield fell to 2.202%, down 3.8 basis points for the day. Gold and long end bond yields are known to have an inverse relationship. Meanwhile, signs of weakness in the US equity markets also helped the safe haven metal recover losses.
Gold Technical Levels
The metal currently trades at USD 1186.4/Oz. The immediate resistance is located at 1190.25 (50-DMA), above which gains could be extended to 1199.5. On the flip side, a break below 1184.00 could drive the metal back to its daily low of 1178.6.