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Gold News: Steady as Traders Await Fed Signals and Economic Data for Next Move

By:
James Hyerczyk
Published: Dec 30, 2024, 12:22 GMT+00:00

Key Points:

  • Gold prices hold steady in thin holiday trade, with key levels at $2629.13 and $2607.35 guiding near-term direction.
  • A break above $2629.13 could drive gold to $2663, while a drop below $2607.35 risks testing $2583 support.
  • Traders await Fed minutes and job data later in January as Powell signals cautious approach to future rate cuts.
  • Gold has surged 27% in 2024, hitting $2790.17 in October, driven by central bank buying and U.S. rate cuts.
  • Trump’s 2025 policy plans, including tariffs and deregulation, could shift gold’s outlook next year.
Gold Price Forecast

In this article:

Gold Prices Drift Lower in Quiet Holiday Trade

Gold prices are under slight pressure as trading opens for the holiday-shortened week, with thin volumes keeping the market within a narrow range between $2629.13 and $2607.35. This consolidation reflects a wait-and-see approach from traders, who are eyeing key U.S. economic data and Federal Reserve policy signals in the weeks ahead.

A break above $2629.13 could signal buying interest, potentially driving gold toward resistance near $2663.41, aligned with the 50-day moving average. Conversely, sustained movement below $2607.35 may trigger heavier selling, with the next support near $2583.91. A deeper slide could expose gold to further downside, testing $2536.85.

At 12:09 GMT, XAU/USD is trading $2618.40, down $3.64 or -0.14%.

Fed Policy and Economic Data in Focus

Markets are bracing for upcoming U.S. economic indicators, including the Fed’s December meeting minutes and employment data, as investors gauge the likelihood of additional rate cuts. Recent comments from Fed Chair Jerome Powell suggest a cautious stance on further easing, reinforcing the importance of upcoming labor market data to shape policy expectations.

Gold’s performance has been robust in 2024, climbing approximately 27% and marking an all-time high of $2790.17 in late October. Central bank purchases and ongoing U.S. rate cuts have been critical drivers of this rally. Traders are now monitoring potential policy changes as President-elect Donald Trump prepares to assume office, with expectations for tariffs, deregulation, and tax adjustments to influence markets in 2025.

Yields Dip as Year Draws to a Close

U.S. Treasury yields edged lower on Monday, reflecting subdued trading as investors wind down positions ahead of year-end. Economic reports, including pending home sales and manufacturing indices, may offer final insights into the health of the economy before 2024 concludes. Last week’s jobless claims underscored a mixed labor market, with continuing claims reaching their highest level since late 2021.

Market Forecast

Daily Gold (XAU/USD)

Gold is likely to remain in consolidation this week, with low liquidity limiting large moves. However, traders should be prepared for volatility as key economic data releases unfold. A bullish breakout above $2629.13 may open the door to higher prices, while a bearish break under $2607.35 could expose gold to further declines. With central bank buying and geopolitical uncertainties persisting, gold’s long-term outlook remains constructive.

More Information in our Economic Calendar.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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