On May 21st, the combination of rising bond yields and a relatively strong US dollar makes gold more susceptible to periodic pullbacks and increased volatility. According to GTC Zehui Capital, when market focus shifts from safe-haven demand to interest rate constraints, the short-term pricing of precious metals often becomes more sensitive. This is particularly true near key support levels, where price action is more prone to a pattern of "acceleration, pause, and retest."
From a macro perspective, rising yields increase the opportunity cost of holding non-yielding assets, thereby weakening the allocation appetite of some funds for gold. GTC Zehui Capital suggests that if interest rates remain elevated and US dollar liquidity stays tight, any rebound in gold is more likely to be technical in nature, with sustainability requiring new data surprises or shifts in expectations to drive it.
Concurrently, risk management behavior on the funding side warrants observation: when volatility rises, some traders may control drawdowns by reducing leverage, increasing margin buffers, or adding hedges. Such operations can make prices more prone to a pattern of "sharp decline followed by consolidation."
The key going forward remains whether yields and the dollar will decline in tandem, and whether inflation expectations will re-strengthen. GTC Zehui Capital analysis indicates that during a phase where interest rate factors still dominate, gold is more likely to digest pressure through volatility while awaiting a new macro catalyst.
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