XAU/USD outlook: Gold Tumbles 1.5% and Pressures Key Supports as Dollar Rises to 4-mth High

Spot gold tumbled 1.5% on Tuesday, in extension of steep fall that commenced on Monday.

The dollar rose to four-month high, driven by higher US Treasury yields which hit 14-month high on growing expectations that speedy vaccination would accelerate economic recovery, hammering demand for safe-haven yellow metal.

Bears cracked pivotal Fibo support at $ 1681 (38.2% of $ 1046/$ 2074) and pressure another key level at $ 1676 (Mar 8 low, the lowest since early June 2020).

Firm break of these supports would risk fresh bearish acceleration, with initial support at $ 1661 (100WMA) guarding psychological $ 1600 support.

The action is heavily pressured by thick weekly cloud, while bearish studies on daily and weekly chart add to negative signals.

Res: 1699; 1714; 1721; 1728
Sup: 1676; 1661; 1600; 1560