Gold News: Prices Stall at Record Highs as Traders Await U.S. Jobs Data

Gold Prices Stall After Record Highs as Traders Eye U.S. Jobs Data

Gold prices are taking a breather on Thursday after surging to an all-time high of $2,882.31 in the previous session. The consolidation within Wednesday’s range signals investor hesitation, with traders closely watching key technical levels. A pullback toward the minor pivot at $2,827.26 could test market sentiment, determining whether dip-buying remains dominant or if a deeper correction is ahead. A breakout above $2,882.31 would confirm a continuation of the uptrend.

At 11:55 GMT, XAU/USD is trading $2865.13, down $2.08 or -0.07%.

Gold Rally Faces Resistance as Overbought Signals Emerge

Gold’s five-session winning streak has paused, but momentum remains strong. The recent rally was fueled by escalating trade tensions between the U.S. and China, which heightened economic uncertainty and raised questions about the Federal Reserve’s policy path.

Despite the slight pullback, gold’s technical indicators suggest caution. The Relative Strength Index (RSI) is sitting around 76, indicating overbought conditions. Historically, RSI levels above 70 increase the likelihood of a near-term correction, as traders look to lock in profits.

However, global risk sentiment continues to support gold. Trade war concerns have driven safe-haven demand, but the possibility of prolonged inflationary pressures due to tariffs could also shift sentiment. If the Fed signals a prolonged period of higher interest rates, gold could face renewed selling pressure.

U.S. Jobs Data in Focus as Treasury Yields Tick Higher

Traders are now turning their attention to Friday’s nonfarm payrolls (NFP) report, which could influence the Fed’s rate outlook. Treasury yields have edged higher as markets brace for the employment data, with economists forecasting 175,000 job additions and an unchanged unemployment rate of 4.1%. A stronger-than-expected report could reinforce expectations that the Fed will maintain restrictive monetary policy, pressuring gold. Conversely, a weaker print could revive rate-cut bets, supporting the metal.

The ADP report on Wednesday showed private payrolls grew by 183,000 in January, surpassing expectations. This adds to speculation that the labor market remains resilient, which could challenge hopes for rate cuts in the near term.

Trade Tensions Remain a Wild Card for Gold Prices

Although initial fears over tariffs have subsided, uncertainty lingers. President Trump recently announced a temporary 30-day pause on new tariffs for Mexican and Canadian goods, easing some concerns. However, China has retaliated with its own tariffs, including a 15% duty on U.S. liquefied natural gas and other select products, effective February 10. Any further escalation could drive renewed safe-haven demand for gold.

Meanwhile, Federal Reserve officials, including Governor Christopher Waller and San Francisco Fed President Mary Daly, are set to speak on Thursday. Their comments could offer additional insight into the Fed’s policy direction, adding another layer of uncertainty for traders.

Gold Prices Forecast: Bulls Hold the Edge, but Caution Warranted

Gold remains in an uptrend, but the rally appears stretched in the short term. The overbought RSI suggests the potential for a pullback, with $2,827.26 as the key level to watch. If buyers defend this zone, gold could make another push toward record highs.

However, a strong NFP report or hawkish Fed commentary could trigger a deeper correction. On the flip side, any sign of economic weakness or escalating trade tensions could reinforce gold’s bullish momentum. For now, the bias remains positive, but traders should be prepared for increased volatility.

More Information in our Economic Calendar.