Article by: ETO Markets

The expectations of a dovish policy shift by the US Federal Reserve this year gained traction following sharp declines in the US Treasury bond yields throughout the curve in March, as evidenced by the US ISM Services PMI and the Price Paid sub-index, which fell to 51.4 and 53.4 in March, respectively. The US dollar's decline was aided by markets' celebration of the revived optimism and the declining yields on US Treasury bonds.

Buyers of gold should continue to exercise care due to the severely overbought Relative Strength Index conditions on the daily chart. The next objective at the psychological $… level would be revealed if acceptance over the $… round level is seen on a daily closing basis, which would support positive interest in the price of gold. However, any downward correction could find initial support near the high of April 2, $… , below which the psychological $… barrier would be tested.