• Gold tumbles to 1890$ and then rebounds more than 20$.
• Volatility is set to remain high amid news from Ukraine and sharp moves in the Treasury market.
• Bearish bias prevails in XUA/USD, more losses seen on a consolidation under 1900$.

Gold is having another volatile session on Tuesday. Price dropped sharply to 1890$ following positive reports about the conversation between Ukraine and Russian authorities. It then rebounded sharply, rising back above 1910$.

XAU/USD is hovering around 1912$ as stocks in Wall Street hold onto daily gains. The yellow metal received support from a weaker US dollar and lower US yields. The DXY is having the worst day since March 10, falling 0.90%; it trades at 98.25, after finding support above 98.00.

The Treasury market is also making sharp moves. The US 10-year yield peaked earlier at 2.53% and then tumbled to as low as 2.38%. As of writing, it is hovering around 2.43%. The decline in yields took place amid an improvement in market sentiment.

XAU/USD holding above 1910$

While US yields continue to correct lower, gold could find buyers after dips. If yields start rising again, gold will likely came under pressure. A consolidation under 1900$ (or a daily close below 1910$) would likely trigger more losses. The next strong support stands at 1885$ (55-day SMA) followed by 1875$ and 1850$.

On the upside, the daily high at 1930$ is the first relevant resistance, followed by the 20-day simple moving average that stands 1955$. A daily close above 1960$ would negate the current negative bias.

Technical levels