Gold Price Analysis: Key support for XAU/USD is located at $1,720

The XAU/USD pair is posting modest daily gains and holds above $1,730. Additional gains are likely if the $1,720 support continues to hold, FXStreet’s Eren Sengezer reports.

Key quotes

“The benchmark 10-year US Treasury bond yield is down nearly 1% in the early American session on Monday, allowing XAU/USD to preserve its bullish momentum. Additional losses in the T-bond yields could help the pair push higher in the remainder of the day.”

“$1,720 (23.6% retracement of the February-March decline) seems to have formed strong support for gold in the near-term. As long as buyers manage to defend this level, XAU/USD could try to extend its recovery to $1,745 (Fibonacci 38.2% retracement/20-day SMA).”

“Although it seems unlikely in the current technical setup, a daily close above $1,745 could open the door for additional gains towards $1,767 (Fibonacci 50% retracement).”

“On the downside, sellers could look to bring gold back to the $1,700 (psychological level) area with a break below $1,720.”