The

yellow metal is losing ground, suffering once again from the

accelerated rise in bond yields in the face of renewed concerns about

inflation and interest rates.

At

the same time, Janet Yellen warned of a risk of default on US debt for

the first time in history if the budget deficit ceiling is not raised by

October 18.

The

U.S. bond market continued to a selloff for the fourth straight

session, keeping yields on the rise. The yield on 2-year Treasuries rose

to 0.3147%, its highest level since March 2020, the 5-year rose above

1% for the first time since February 2020, and the 10-year is up more

than six basis points to 1.5444% after reaching its highest level since

June at 1.561%.

In

the medium term, prices are evolving within a bearish channel, so an

acceleration towards the lower bound should not be excluded. Moreover,

the polarity zone around $1,690/$1,680 is a major threshold for the

future. Indeed, the market has come to support this level several times

before rebounding.

(Chart Source: Tradingview 28.09.2021)

To

sum up, a sell-off seems to be taking place and the macroeconomic

outlook does not benefit the yellow metal in the current context. Chart

analysis suggests a deeper correction ahead, so it will be wise to wait

for a return to the $1,680 area before attempting to buy on the cheap.

Disclaimer:

This material has been created for information purposes only. All views

expressed in this document are my own and do not necessarily represent

the opinions of any entity.