Gold prices recovers as U.S. Treasury yields have fallen ! (With Trading Strategy)

At 08:30 Hong Kong time before the deadline, the price of gold rose by 0.02% to US$1716.80.

Spot gold rose sharply by nearly 2% on Tuesday (March 9), as the yield of US Treasury bonds and the U.S. dollar fell from their highs, and the price of gold got a respite.

Spot gold closed at 1715.95 US dollars per ounce, up 32.54 US dollars or 1.93%, the lowest intraday hit 1679.99 US dollars per ounce, the highest hit 1720.45 US dollars per ounce.

COMEX April gold futures closed up 2.3%, at US$1716.90 per ounce.

Lukman Otunuga, senior research analyst at FXTM, said: "Given the zero-yield nature of gold, the decline in yields may provide favorable conditions for bulls to push up prices."

However, although gold prices may continue to rise in the short term, "fundamentally speaking, the swing of the pendulum is beneficial to bears, especially considering that with the promotion of vaccines and the reduction of confirmed cases of new crowns worldwide, global sentiment is improving."

Gold traders should continue to pay attention to the February inflation data in China and the United States in order to seek new impetus beyond the US stimulus bill. Looking back at the non-agricultural employment data released by the United States last week, the performance has been brilliant, which has benefited the U.S. dollar. This also means that in the absence of too many important events to support, gold investors still need to be cautious and continue to focus on the trend of US Treasury yields.

Trading strategy (Source: Trading Central)

Pivot: 1778.00

Our preference: short positions below 1778.00 with targets at 1668.00 & 1608.00 in extension.

Alternative scenario: above 1778.00 look for further upside with 1818.00 & 1848.00 as targets.

Comment: the RSI shows downside momentum.

Supports and resistances:

1848.00 ***

1818.00 **

1778.00 ***

1711.00 Last

1668.00 ***

1608.00 ***

1568.00 **

Guideline for Trading Central strategy

Trend chart reading guideline

1. First look at the time period in the upper left corner of the chart：

・30MIN and 1H chart shows the trading suggestions for intraday

・Daily chart shows the market trend analysis in next 2-3 days

2. The blue horizontal line on the chart marks the pivot: pivot indicates the reversal of the market. When the price is above the pivot, it indicates an upward trend, when the price is below the pivot , it indicates a downward trend. When the price breaks through the pivot, the trend is reversed.

3. The red and blue thin curves in the Candlestick chart chart are technical indicators: Red line is MA20+Bollinger bands, Blue line is MA50. under the Candlestick chart chart are also the technical indicators:  Blue line is RSI, Red line is 9MA;

4. The green horizontal line is the resistance level for a price increase, and is also the profit target for long orders; the red horizontal line is the support level for a price decrease, and is also the profit target for short orders.

How to use TC strategy？

1.[Pivot] is the reversal line of the market trend. When the price up the pivot line which means in Bullish, you can open a long position or Buy. on the contrary, when the price under pivot line which means in bearish. You ‘d better make short positions or Sell.

2. [our preference] is the main trading suggestion for your reference. You can exit your trading refer to this target or close positions before it.

3. [Alternative scenario] is the plan B for your reference.

4. [Comment] is the technical analysis of market trends and technical support for trading strategies.

5. [Supports and resistance] Supports are levels where the price tend to find support as it falls.

Resistances are levels where the price tend to find resistance as it rises. So, exit before the trend reverse.