Chart Of The Day: Rising Interest Rates Means Falling Gold – Investing.com India

Chart Of The Day: Rising Interest Rates Means Falling Gold – Investing.com India

The outlook for is not promising. Expectations for higher interests rates makes the yellow metal less attractive.The FundamentalsRising yields come about with expectations for rising rates, amid the economic recovery and rising . Given that gold does not produce a yield—unlike the via interest rates—rising rates favor the USD, at the expense of gold. Also, a rising greenback makes the yellow metal, which is priced in dollars, more expensive, hitting demand, which hurts gold even more so.After hitting a new all-time high last year, gold has fallen back to its pre-coronavirus levels which is telling. Investors think the virus and lockdowns are behind them. They expect that COVID-19 vaccines will allow the economy to reopen and pick-up where it left off before the coronavirus outbreak, boosted by unprecedented infrastructure spending.The TechnicalsGold has completed a rising flag—a price move which speculators believe shows a rebound is underway, but which turns out to be a short-lived short-cover bounce before another leg down.The flag fits precisely within a falling channel since the January high—mirroring the dollar bottom—and the flag's conclusion signals the new, steeper channel will break through the bottom of the more tempered, broader falling channel since the August record.CautionWith