At 19:10 GMT, April Comex gold futures are trading $1796.40, down $26.80 or -1.47%.
If you’re a gold trader then you have to stop reading the reports from the long-term gold bugs and the brokers who continually push the weak dollar/strong gold narrative. It’s not working now and it has worked since August 7, 2020 when gold hit its high of the year. Since then, the dollar has fallen considerably, but so has gold. Early today it hit 50% of its March 2020 to August 2020 rally.
The greater, most accurate correlation is between Treasury note yields and gold. When yields go up, gold goes down plan and simple. Or course, you can call out all historical correlations when we have unprecedented events like a pandemic, but over the long run, the correlation holds true.
10-Year Treasury Yield Hits Highest Level in a Year
Treasury yields drifted higher on Tuesday, with the 10-year Treasury yield hitting a level not seen since February 2020.
The yield on the benchmark 10-year Treasury note climbed to 1.29% at around 19:00 GMT, breaking above the 1.28% level for the first time since February 2020. Meanwhile, the yield on the 30-year Treasury bond rose to 2.08%. Yields move inversely to prices.
The 10-year benchmark is widely watched as it influences mortgages and other loans.
Treasury yields were higher as investors continued to watch for progress on President Joe Biden’s proposed $1.9 trillion stimulus package in Congress, as well as the coronavirus vaccine rollout in the U.S.