ISLAMABAD: Gold managed to regain some positive traction on Wednesday amid a modest pullback in the US Treasury bond yields that kept the US dollar bulls on the defensive and extended some support to the yellow metal.
At 1315 hours GMT, gold in the international market was available at $1,738.20 per ounce after gaining $3.40.
Meanwhile, the price of 10 grams of yellow metal in Pakistan increased to Rs95,400 after gaining Rs1,000. The closing prices of the yellow metal in the country remained Rs94,400 on Tuesday last. A relatively higher increase in local gold prices as compared to international price was due to depreciation of rupee against the US dollar.
According to experts, gold recovered a part of the overnight losses due to a weaker US dollar. However, a solid recovery in the global equity markets could act as a headwind for the safe-haven precious metal. Apart from this, prospects for an early policy tightening by the Fed might further collaborate to cap the upside for gold, they added.
From a technical point of view, gold struggles to pick up amid sluggish MACD and RSI lines, which in turn hint at further weakness towards retesting the two-week-old descending support line, around $1,727. However, the RSI line can test the oversold region around then, limiting additional downside. Ignorance of this could direct the quote to the $1,700 threshold before highlighting the yearly trough surrounding $1,687.
Meanwhile, recovery moves need to cross the immediate trend line hurdle near $1,745 before directing gold buyers to a descending resistance line from September 03, near $1,771. Overall, gold remains pressured towards the yearly low but intermediate bounces can’t be ruled out, according to experts. – TLTP