Breaking: Gold plummets to two-month lows, below $1800 mark
- Rallying US bond yields, stronger USD continued exerting heavy pressure on gold.
- The upbeat market mood also did little to lend any support to the safe-haven metal.
- Break below the $1800 mark might have already set the stage for further weakness.
Gold dropped to two-month lows during the early North American session, with bears now looking to extend the downward trajectory below the $1800 mark.
The precious metal witnessed heavy selling for the third consecutive session on Thursday and was pressured by a combination of factors. The US Treasury bond yields continued scaling higher amid firming expectations for a massive US fiscal spending, which, in turn, continued driving flows away from the non-yielding yellow metal.
The US bond yields rose further following the release of better-than-expected US Initial Weekly Jobless Claims. Positive US economic data, along with the progress with coronavirus vaccinations lifted hopes for a strong economic recovery and benefitted the US dollar. This was seen as another factor weighing on the dollar-denominated commodity.
Meanwhile, the optimism remained supportive of the underlying bullish sentiment in the financial markets, which did little to lend any support to the safe-haven XAU/USD or stall the ongoing decline. With the latest leg down, the commodity seems to have confirmed a bearish breakdown and seems vulnerable to extend the depreciating move.
Technical levels to watch