Gold prices has edged lower on Thursday as higher U.S. Treasury yields has dented the metal’s appeal, although losses were limited due to a weaker dollar and Federal Reserve Chairman Jerome Powell’s dovish comments.

The US 10-year Treasury yields step back from 1.3940%, the highest since February, to 1.3810% the latest. Comments from Fed policymakers supported investor confidence on Wednesday. The US central bank board members, including Fed Chair Jerome Powell, rejected chatters around abrupt rate hikes while also rejecting the reflation fears the previous day.

Further, Favoring the mood could be the news that The first big real-world study of the Pfizer/BioNTech vaccine to be independently reviewed shows the shot is highly effective at preventing COVID-19, in a potentially landmark moment for countries desperate to end lockdowns and reopen economies.

The news from Daily Mail which suggests no tax-hike threats in the UK’s next budget which brightened the mood. Furthermore, the RBNZ’s acceptance of the New Zealand Finance Ministry’s requirement to consider housing prices and government policies for decision-making offered extra strength to the market sentiment.

Central bankers worldwide have been unequivocal that there are no plans to cut back on money-printing any time soon, or raise interest rates, but markets do not seem to be buying it.

On the other hand, Sales of new U.S. single-family homes increased more than expected in January, boosted by historically low mortgage rates and an acute shortage of previously owned houses on the market.

XAU/USD 4 Hour Chart:

Support: 1787.4 (S1), 1770.2 (S2), 1756.9 (S3).

Resistance: 1817.9 (R1), 1831.1 (R2), 1848.3 (R3).

Amidst all the catalysts creating short term pressure on the yellow metal, we expect a bearish trend for XAU/USD.