Gold drops to two-week lows near $1,480, erases more than $25 on the day
- Gold struggles to find demand as a safe haven on Tuesday.
- US Dollar Index surges higher on upbeat data.
- 10-year US Treasury bond yield gains nearly 8% since the start of the week.
The bearish pressure surrounding the XAU/USD pair intensified on Tuesday after it broke below the $1,500 mark. The broad-based USD strength and the risk-on atmosphere dragged the pair to its lowest level in two weeks near $1,480. As of writing, the pair was down $26, or 1.7%, on the day at $1,482.80.
Reports suggesting that the United States (US) and China are closing in on the completion of the phase-one of the trade deal allowed the market sentiment to turn positive in the first half of the week and made it difficult for traditional safe-haven assets such as the precious metal find demand.
Reaffirming the upbeat market mood, the 10-year US Treasury bond yield is adding nearly 8% since the start of the week and Wall Street's main indexes advanced to new all-time highs.
DXY advances to 98 area on Tuesday
In the meantime, the greenback continued to find demand on the back of inspiring macroeconomic data releases from the US on Tuesday and put additional weight on the pair's shoulders.
The Institue for Supply Management's (ISM) Non-Manufacturing Index (NMI) rose to 54.7 in October to beat the market expectation of 53.5 and the trade deficit in September narrowed to $52.5 billion from $55 billion. Fueled by the data, the US Dollar Index (DXY) rallied to its highest level since mid-October at 98.01 and was last seen at 97.96.
Technical levels to watch for