Gold reaches weekly highs despite rising yields. Following the release of the US May CPI report, XAU/USD fell to $1824, the lowest level in three weeks, as Treasury yields rose. 

Gold broke above $1850 and gained strength after moving sideways in a wide range. 

Technical factors, as well as the yellow metal’s likely reaction to inflation, are driving up gold prices. Bears appear to be capitulating in the short term. Gold is rallying even as the dollar and US yields are rising.

The DXY is up 0.80% to 104.15, its highest level since May 17. The US 10-year yield is 3.15 percent, and the 30-year yield is 3.22 percent, both at their highest levels since May 9. At the same time, the Dow Jones and the S&P 500 are down more than 2%. The DXY and US yields have reached their highest level since May 9. 

Higher yields, risk aversion, and a stronger dollar are typically negative for gold. It has not been the case in the last hour. XAU/USD has risen $45 since the daily low. XAU/USD is approaching the $1870 resistance level.

From a technical standpoint, if XAU/USD remains above $1870, it would indicate further gains. The next significant resistance level is seen at $1890. On the contrary, a return to current levels below $1850 would put gold under pressure. 

Gold prices are surging on Friday, despite higher US yields and a stronger dollar. XAU/USD rebounded again at $1830, but this time it broke $1850 and reached $1870 a few minutes later.

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