With rates moving higher alongside the dollar, you’d typically associate that with weaker gold prices. At least that seems to be the case these days when it comes to the buy the dollar, sell everything else narrative; vice versa. But perhaps with tensions growing in the Middle East, that is lending a helping hand to gold to push higher alongside oil prices today.
Gold (XAU/USD) hourly chart
The jump higher in gold now sees a potential near-term breakout, after having pushed past key levels as highlighted here earlier in the day. With prices now above $2,050, gold is up over 1% and looking to turn the more bearish momentum to start the year into a more bullish one instead.
For some context, gold is moving up even as 10-year Treasury yields are at the highs for the day now – up 2.8 bps to 4.00%. Meanwhile, the dollar is also sitting firmer across the board and trading to session highs as well while stocks are being pushed lower ahead of US trading.