Gold regains poise on ‘boring Yellen’

Gold [XAU/USD] is trading with moderate gains around $1288/Oz levels after ‘boring Yellen’ triggered broad based selling in the US Dollar. 

The treasury yield curve/spread between the 10-year and 2-year yield currently stands at 84 basis points v.s 86 basis points yesterday.  The drop in the long duration treasury yields is negative for the USD and positive for gold. 

The metal hit an Intraday low of $1276 while heading into Yellen speech as investors were expecting hawkish comments from Yellen. However, the Fed chief restricted her speech to recitation of the financial crisis and regulatory improvement since then. 

Hence, the disappointed investors ditched the US dollar, leading to a recovery in gold. Nevertheless, the gains in the yellow metal are being capped around $1288 levels. 

Gold Technical Levels

A break above $1292.11 [Aug 11 high] would open doors for $1296 [June 6 high] and $1300 [psychological level + Aug 18 high]. On the downside, breach of support at  $1285 [4-hour 50-MA] could yield a pull back to $1278 [4-hour 100-MA] and $1276 [Intraday Low].