Gold, Bond Yield, US Dollar Technical Analysis: Market Trends and Key Levels

The US Dollar remains strong near the 108.00 mark, demonstrating resilience in thin year-end trading. Robust economic data and reduced expectations for Federal Reserve rate cuts in 2025 support the Greenback’s upward trajectory. Treasury yields further bolster the Dollar’s strength, with the 10-year yield hovering near 4.60% and testing multi-month highs. Despite some profit-taking and geopolitical uncertainties, the Dollar’s strength persists, limiting the upside potential for gold.

Gold (XAU) finds support around the $2,580 level amid geopolitical tensions and potential shifts in US trade policy under a possible Trump administration. Heightened trade tensions, along with ongoing crises in the Middle East and the Russia-Ukraine war, drive demand for gold as a safe-haven asset. However, lighter trading volumes during the holiday season limit significant gains. Gold is currently trading within consolidation patterns, awaiting its next directional move.

The US will release Chicago PMI and pending home sales data on Monday. However, the impact of this data on the market may be limited due to the upcoming holidays. Unemployment claims data on Thursday, and ISM manufacturing PMI on Friday could influence the US Dollar Index. Currently, the index is consolidating around 108. As long as it remains above 105.60, the trend stays positive, which may limit gold’s upside momentum in the short term.

Gold (XAU) Technical Analysis

Gold Daily Chart – Symmetrical Triangle

The daily chart for gold shows that the price is consolidating within a symmetrical triangle while holding key support levels. The price recently bounced near $2,580, aligning with the 100-day SMA and confirming strong support. The 100-day and 200-day SMAs suggest bullish momentum. A breakout from the symmetrical triangle is likely to determine the next significant move in the gold market. The RSI remains neutral, indicating room for further price consolidation.

Gold 4-Hour Chart – Descending Trendline

The 4-hour chart for gold shows that the price is trading below the downward trendline, indicating bearish momentum. However, the price is forming a consolidation pattern in December. Additionally, the RSI hovers around the midline, signaling a neutral trend. A breakout above the resistance line could indicate a positive trend, while a break below $2,550 may confirm further downside.

Treasury Yields (TNX) Technical Analysis

10-Year Treasury Note Yield Daily Chart – Descending Trendline

The daily chart for the 10-year Treasury yield shows a breakout above the 1-year descending trendline near 4.40%. This move is supported by the 50-day and 200-day SMAs, signaling bullish momentum. The price is now approaching resistance levels at 4.62% and 4.70%. The RSI remains above 50, indicating strength but nearing overbought territory. The recent inverted head-and-shoulders pattern suggests further upside potential if yields can break above the 4.70% resistance.

10-Year Treasury Note Yield Hourly Chart –Ascending Channel Pattern

The 4-hour chart for the 10-year Treasury yield shows the upward trend within the ascending channel. The price recently broke above the 4.10% level and is now approaching resistance between 4.70% and 4.75%. The ascending channel highlights a clear bullish trend. The RSI is above 70, signaling overbought conditions and possible consolidation. The breakout above the long-term trendline indicates bullish momentum. The upward trend in Treasury yields is likely to continue, while a breakdown below the channel could reverse the trend.

US Dollar (DXY) Technical Analysis

UD Dollar Daily – Consolidation

The daily chart for the US Dollar Index shows that the index has broken above 105.60 and is consolidating near 108 as 2024 approaches its close. A bullish hammer pattern at 105.60 confirmed the breakout, supported by strong momentum. The index also broke through resistance at 107 before pausing for consolidation.

The 50-day and 200-day SMAs indicate a continuation of the bullish trend. Additionally, the RSI remains elevated near 64, signaling strength but not yet overbought conditions. A sustained move above 109 could signal further gains, while a failure to hold may lead to a pullback.

US Dollar 4-Hour Chart – Ascending Channel

The 4-hour chart for the US Dollar Index shows that the index is trading within an ascending channel, signaling bullish momentum. The price recently bounced off support near 105.60 and continues to trade above this level.

The index faces resistance near 110.50, aligning with the upper boundary of the channel. A head-and-shoulders pattern near support highlights ongoing consolidation before the next move. A breakout above 110.50 could extend the rally, while a breakdown below 105.60 may signal a potential reversal.