Gold Price Forecast: XAU/USD unable to consolidate above $1680 as yields keep rising

• Gold looks vulnerable as government bond yields continue to rise.
• Yellow metal peaked at 1684$ and retreated back to the 1670$ area.
• Price continues to move in a wide range, bearish bias.

Gold rose after the beginning of the American session to 1685$, hitting a fresh daily high but it failed to hold above 1680$ and retreated to 1667$. It is hovering around 1670$, as it continues to move sideways in a wide range between 1655$ and 1685$.

Volatility remains elevated but XAUUSD holds within the range. The consolidation takes place within a bearish trend that remains in place. A firm recovery above 1680$ could open the doors for a larger bullish correction. On the flip side, under 1650$ could trigger an acceleration targeting initially 1640$.

Following the 75 bps rate hike from the Federal Reserve, US yield continues to rise on Thursday. The US 10-year yield are at 3.70%, the highest level since February 2011 while the 2-year reach 4.15%, the highest since 2007. Higher yields are usually not good news for gold bulls. In the current context, bad news could be positive for gold. 

Earlier on Thursday, the Japanese government's intervention in the currency market weakened the dollar and favoured the rebound in XAU/USD. However, the recovery was short-lived.

Technical levels