Gold Price Analysis: XAU/USD rallies back closer to multi-month tops, around $1840 region

Update: Gold continued scaling higher through the early European session and jumped to the $1,840 level in the last hour, back closer to near three-month tops touched earlier this week.

The ongoing downfall in the US Treasury bond yields failed to assist the US dollar to capitalize on this week’s positive move inspired by a red-hot US CPI report.

The strong intraday positive move seemed rather unaffected by a strong opening in the US equity markets, which tends to undermine demand for the traditional safe-haven gold.

The extension of the declines in the US Treasury yields could be seen as a catalyst behind the dollar’s fresh leg down.

The gold price is building onto Thursday’s day rebound and eyes the horizontal trendline add credence to a potential move higher.

Update: Gold reversed an Asian session dip to the $1,820 area and turned positive for the second consecutive day, with bulls now looking to build on the overnight bounce from one-week lows.

That said, a generally positive tone around the equity markets might act as a headwind for traditional safe-haven assets and cap any meaningful upside for gold.

Update: Gold extends the previous day’s losses to early Friday, down 0.10% to $1,823 by the press time.

Behind the moves could be the mixed play between the coronavirus woes in Japan and India, recently in the UK, as well as the US optimism backed by the firm inoculation.

Gold struggles to extend Thursday’s recovery moves around $1,830 amid the initial Asian session on Friday.

Amid these plays, Wall Street benchmarks marked the first positive day of the week while the US 10-year Treasury yields eased to 1.64%, down 4.4 basis points by the end of Thursday’s US session.

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Sterling is shrugging off worries about the spread of new virus variants, which may delay the reopening.

Gold could be on the verge of a lower low, but the hourly time frame is key.

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