Gold Price Analysis: Rejected above $1,650 after biggest single-day gain since June 2016

• Gold has pulled back from session highs, confirming a bearish indicator divergence on the hourly chart. 
• The bias will remain bullish as long as prices are holding above $1,630. 

Gold is currently trading at $1,643 per Oz, having hit a session high of $1,652 in early Asia. 

The bid tone around the yellow metal has weakened amid the recovery in the US treasury yields. At press time, the US 10-year yield is trading at 0.983%, up seven basis points from the record low of 0.91% reached during Tuesday's Asian trading hours. The two-year yield has also recovered to 0.683% from the overnight low of 0.616%. 

The pullback may be extended further as the hourly chart relative strength index (RSI) is reporting a bearish divergence. 

That said, the bullish bias put forward by the descending trendline breakout on the 4-hour chart would weaken only if prices find acceptance under $1,630. Alternatively, a move above $1,652 would invalidate the bearish divergence of the RSI seen on the hourly chart and open the doors for resistance at $$1,660.

Gold jumped by over 3 percent on Tuesday, confirming its biggest single-day gain since June 24. On that day, prices had risen by more than 4 percent on Brexit uncertainty. 

The metal found love as the Fed cut interest rates by 50 basis points to contain the negative impact of the virus on the economy and financial markets, sending Treasury yields to record lows. 

Hourly chart

4-hour chart

Trend: Correcting lower

Technical levels