Core Drivers of Bullish Trends:Gold vs US DollarPEPPERSTONE:XAUUSDAvaTaylorCore Drivers of Bullish Trends: The sharp drop in the US dollar index, relieving significant selling pressure, became the core driving force: As the currency for gold pricing, the US dollar index directly determines the short-term direction of gold price fluctuations. Since yesterday, the US dollar index has plummeted from 101.48 to 100.2, breaking through multiple key support levels and hitting a nearly six-month low. This significant depreciation of the dollar has greatly increased the attractiveness of dollar-denominated gold to global investors, leading to a surge in overseas funds into the gold market and driving up gold prices. In the short term, the US dollar index remains weak and has not yet shown signs of stabilization, which is expected to continue to support gold prices, providing the core confidence for bullish sentiment today. The sharp decline in US Treasury yields has drastically reduced the cost of holding gold: As a non-interest-bearing asset, the opportunity cost of holding gold is negatively correlated with US Treasury yields. The higher the US Treasury yield, the lower the attractiveness of gold, and vice versa. Since yesterday, the yield on the 10-year US Treasury note has plummeted from 4.48% to 3.85%, a drop of 63 basis points, hitting a nearly three-month low. This significantly reduced the opportunity cost of holding gold, leading to a large-scale return of funds previously allocated to the US Treasury market to the precious metals market, providing ample financial support for the rise in gold prices. At the same time, the decline in US Treasury yields also reflects rising market expectations of a US economic recession, further strengthening gold's safe-haven appeal and attracting more safe-haven funds to the market.