• Gold price has resumed its downside journey after the pullback move faded.
• The precious metal failed to extend the rebound move as the risk-off impulse rebounded.
• The 10-year US yields have soared further to 4.23% as a bigger rate hike by the Fed looks certain.

Gold price (XAU/USD) has witnessed a steep fall after the termination of the pullback move at around $1,646.00. The precious metal has resumed its downside journey and is revisiting the two-year low at $1,614.85. Cat got gold prices tongue as the market impulse turned risk-averse again after S&P500 surrendered their gains in the New York session.

Meanwhile, returns on US government bonds have reached the rooftop as odds for a fourth consecutive 75 basis point (bps) rate hike by the Federal Reserve (Fed) has heated further. The 10-year benchmark US Treasury yields have soared to 4.23%.

Fed Beige Book, released this week, cited that inflationary pressures are here to stay led by rising input prices. This has strengthened the need of tightening monetary policy further. As per the CME FedWtch tool, the probability of a 75 bps rate hike announcement is stable above 95%.

Firmer yields fetched strength for the US dollar index (DXY) after it dropped below 112.20 when market sentiment was bewildered. The DXY has recaptured the critical hurdle of 113.00.

Gold technical analysis

On an hourly scale, the gold prices are declining towards the two-year placed at $1,614.85, recorded on 28 September 2022. The 100-period Exponential Moving Average (EMA) at $1,645.63 acted as a major barricade for the counter.

Meanwhile, the Relative Strength Index (RSI) (14) is oscillating in a 40.00-60.00 range, and a shift into the bearish range of 20.00-40.00will trigger the downside momentum

Gold hourly chart