Gold Drops Below 200-Day Average as US Real Yields Jump

Gold fell below its 200-day moving average to $4,368 an ounce after a roughly 10% decline from its mid-May peak, according to OANDA MarketPulse. The price drop moved gold into a short-term downtrend and raised the potential for further downside toward prior support levels.

The metal reached an intraday high of $4,774 on May 12 and traded down to $4,368 as of May 28. Gold failed twice to break above its 50-day moving average, on April 17 and again on May 12, and has been trading inside a descending channel since its record high on January 29. Price action broke below the 200-day moving average for the first time since a retest on March 23.

Intermarket developments coincided with the move in gold. The 10-year US Treasury real yield, calculated as the nominal 10-year yield minus the 10-year breakeven inflation rate from TIPS, found support near its 200-day moving average around 1.85% in mid-April and climbed about 37 basis points to roughly 2.26% by May 20. The real yield staged a breakout from a descending-channel resistance on May 15. Higher real yields make holding non-yielding assets such as gold relatively more costly for investors.

Technical indicators point to continued downside while gold remains below the short-term pivot at $4,456. The hourly relative strength index is below 30 and shows no bullish divergence. Immediate support is at $4,320, the March 24 low; a deeper support zone lies at $4,262–4,250, with a further extension toward $4,187–4,167. Resistance is at $4,500, followed by $4,580 (the 20-day moving average) and $4,645 (the 50-day moving average).

Kelvin Wong, senior market analyst at OANDA, wrote that the pattern in real yields points to a potential multi-month uptrend and that additional gains in real yields would likely add pressure on gold prices.

Traders will monitor whether the 200-day moving average becomes resistance on any rebound and whether real yields stabilize or continue to advance, which will affect gold's near-term path.