Gold's Descent Continues

Today marks the sixth consecutive day of declining prices in the last seven days, pushing the commodity even lower, below the $1,900 mark. This is the lowest level it has reached since August 22, just as the European session begins.

The US Dollar (USD) is continuing its upward trend and has reached a new 10-month high. This surge follows the Federal Reserve's (Fed) hawkish signal that suggests interest rates will remain elevated for an extended period. This development is putting downward pressure on the price of Gold. Additionally, recent statements from Fed officials have increased expectations of at least one more interest rate hike by the end of the year. As a result, the yield on the 10-year US government bond, a benchmark, has reached its highest point since 2007. This situation is strengthening the USD and diverting investment away from Gold, which doesn't offer interest.

Despite a prevailing risk-averse environment, Gold is not receiving any significant support as a safe-haven asset. Recent data from the United States (US) released on Tuesday revealed that the Consumer Confidence Index from the Conference Board has dropped to a four-month low in September. This decline has raised concerns that consumers are feeling the strain of persistent high inflation and rising interest rates. In addition to this, worries about a real estate crisis in China, the world's second-largest economy, are dampening investors' appetite for riskier assets.

Gold experienced a significant drop, falling below the $1900 level and heading towards the $1885 support level. Yields are currently dominating and attracting all the attention.