Gold dropped after data showed better U.S. economic data

yesterday settled down by -0.67% at 59460 in the wake of better U.S. economic data that falls into the camp of the U.S. monetary policy hawks. A surging and rising U.S. Treasury yields are also bearish outside market elements working against the precious metals. The second estimate of first-quarter U.S. GDP came in better than expected, at up 1.3% versus expectations of up 1.1% and compares to the first GDP reading of up 1.1%. Also, weekly U.S. jobless claims came in well below market expectations.

The marketplace is getting more anxious as U.S. lawmakers and the Biden administration have not agreed to extend the government debt limit. However, House Speaker McCarthy moments ago said negotiators are making some progress on the matter. U.S. Treasury Secretary Yellen has said the government could run out of money by June 1. Reports said the Fitch credit-rating agency put the U.S. on watch for a possible downgrade. “Fitch still expects a resolution to the debt limit before the X-date (1 June),” the credit agency said in a report. Both Fitch and Moody currently rate the U.S. debt at top AAA and Aaa, respectively, while S&P ranks it at AA+ after a downgrade in 2011 amid debt-ceiling negotiations during that time.

Technically market is under long liquidation as the market has witnessed a drop in open interest by -18.37% to settle at 6284 while prices are down -400 rupees, now Gold is getting support at 59231 and below the same and could see a test of 59001 levels, and resistance is now likely to be seen at 59823, a move above could see prices testing 60185.