Gold Price Outlook: XAU/USD Bulls Aim for 2023 High Amid Credit Suisse Turmoil and Drowned Yields

The price of gold (XAU/USD) has surged to $1,920, the highest level in 1.5 months, as investors show risk aversion amid Credit Suisse (CS) drama, followed by the latest fallouts of Silicon Valley Bank (SVB) and Signature Bank. Despite the jump in US Dollar prices and downward move in the United States Treasury bond yields, the precious metal’s haven status continues to attract buyers.

The crisis at Credit Suisse, a global systemically important bank, has triggered fears of another financial crisis, leading to a rush for risk-safety among global market players. The US 10-year Treasury bond yields dropped the most in four months, while the US Dollar Index (DXY) posted its biggest daily gains in a week.

Gold rallied to refresh its multi-day high, and although XAU/USD traders paid little heed to US data, major attention was given to the headlines surrounding Credit Suisse and the market’s fears of another financial crisis. The European Central Bank’s (ECB) action is also important to watch.

From a technical analysis perspective, although the Moving Average Convergence and Divergence (MACD) indicator flashes bullish signals, overbought conditions of the Relative Strength Index (RSI) line suggest the bulls are running out of steam. The 61.8% Fibonacci Expansion (FE) of the Gold price run-up from November 2022 to February 2023, around $2,017, could be a challenge for the bulls.

In summary, the price of gold remains firm, but the road towards the north appears long and bumpy.

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