Gold Price Analysis: Treasury yields rally to stall XAU/USD's upside

Gold price (XAU/USD) ended May with an 8% gain, recording the best monthly rise in ten. Nonetheless, XAU/USD’s rally to $1930 is likely at risk as Treasury yields rebound, FXStreet’s Dhwani Mehta briefs.

Gold awaits the Eurozone inflation and US ISM Manufacturing PMI for fresh cues

“The further upside appears capped by a rebound in the US Treasury yields across the curve. The market mood remains tepid, despite a strong Chinese Caixin Manufacturing PMI report, as investors turn cautious ahead of Eurozone’s inflation data due later in the session ahead. Also, of note remains the US ISM Manufacturing PMI fresh dollar trades, which will have a major bearing on the risk trends and gold price.”

“Gold price remains on track to test the rising channel hurdle on the four-hour chart at $1930 so long as the bulls manage to hold above the bullish 21-simple moving average (SMA) at $1900. However, stiff resistance at the January 8 high at $1918 could challenge the bullish resistance.”

“If the yellow metal faces rejection at $1918, we could see a fresh downside towards the $1900 21-SMA support. Acceptance below the latter could expose a critical cushion at $1890, which is the confluence of the ascending 50-SMA and channel support.”