ANZ analysts said elevated yields were becoming increasingly difficult for bullion to overcome, while resilient US consumption, at an annualised 3.8%, pointed to continued economic strength. Â
ANZ said gold-backed exchange-traded funds (ETFs) attracted over 50 tonnes in September even as US Treasury yields crossed 5%, indicating the inverse relationship between yields and gold prices has weakened.
XAU/USD trades at USD 3,902 with a bearish near-term bias as spot holds below its 20-day exponential moving average (EMA) around USD 4,073. The Relative Strength Index (14) at 32 hovers near oversold territory, suggesting selling could soon start to lose momentum.
On the upside, immediate resistance stands near USD 3,942, followed by the 20-day EMA near USD 4,073, and a sustained recovery above this level would be needed to ease the current downside bias. Gold would be exposed to USD 3,800 if it fails to hold the immediate support at USD 3,870.