Gold attracts some purchasing, albeit the gain remains limited.
The gold price (XAUUSD) trades with a small positive bias for the second day in a row on Friday. But lacks bullish confidence and remains below the $2,000 psychological level throughout the Asian session. Investors appear to have shifted their focus to the carefully watched monthly employment data. From the United States (US) for clues regarding the Federal Reserve’s rate hike course before the end of the year. laying fresh directional bets.
The metal’s gains have been capped by a bullish risk tone as the Fed’s rate-hike path remains uncertain.
Bets that the Fed is reaching the conclusion of its policy tightening campaign. And may begin lowering rates in June 2024 keep US Dollar (USD) bulls on the defensive ahead of the big data risk. This, combined with fears about the Chinese economy slowing and upheaval in the Middle East. Works as a tailwind for the safe-haven Gold price. Albeit the risk on atmosphere as reflected by a largely upbeat tone in the equities markets limits increases.
Daily Market Movers: The gold price is struggling to get traction ahead of the US jobs report.
The gold price has been oscillating in a typical trading band for the previous three days. Awaiting a new stimulus before the next leg of a directional move. Bets that the Federal Reserve will not raise interest rates any further have caused a recent drop in US Treasury bond yields, undermining the US dollar.
The US economy’s resiliency and persistently high inflation. Keep the door open for another Fed rate hike in December 2023 or January 2024.
Fed Chair Jerome Powell stated that a weakening in the labor market is likely in order for inflation to continue its downward trend.
As a result, the US monthly jobs report, or NFP report, may affect the Fed’s next policy decision and provide some major push to the XAUUSD.
The US economy likely added 180K jobs in October, down from 336K the previous month, and the unemployment rate remained unchanged. is expected to remain stable at 3.8%.
Any significant deviation from predicted figures is likely to increase volatility in financial markets and stimulate demand for the safe-haven gold.
Despite a broadly bullish risk tone, the Middle East crisis and China’s economic troubles should continue to function as tailwinds for the commodity.
Technical Outlook
The gold price remains below the psychological level of $2,000 per ounce.
Technically, nothing appears to have changed much for the Gold price, and any following move up is more likely to encounter tough resistance near the $2,000 level. The next meaningful barrier is around $2,008-2,010, or the multi-month high reached last Friday. Bulls must wait for sustained strength beyond the mentioned barrier before positioning for a move. Towards the next meaningful barrier, which is around $2,022.
On the other hand, the $1,980 region now appears to be protecting the immediate downside ahead of the weekly low, which was set on Wednesday at $1,970. Some follow-through selling could expose the $1,964 intermediate support level before the gold price falls to the $1,954-1,953 range.
