Gold Price Forecast: XAU/USD Traders Cautious Ahead of Friday’s Non-Farm Payrolls Report

Highlights

• Gold market influenced by weak US data, Fed uncertainty
• Physical gold demand in Asia slows due to high domestic prices
• Investors monitoring Fed’s monetary policy tightening impact

Overview

Gold futures are trading nearly flat after clawing back an earlier loss. The price action is relatively subdued ahead of Friday’s U.S. Non-Farm Payrolls report and the extended holiday weekend.

At 11:00 GMT, June Comex gold is trading $2036.00, up $0.40 or +0.02% and the XAU/USD is at $2019.93, down $0.48 or -0.02%.  On Wednesday, the SPDR Gold Shares ETF (GLD) settled at $187.82, down $0.16 or -0.09%.

Gold Prices Volatile Amid Weak US Data, Fed Uncertainty

The gold market has been influenced by several factors this week, including weak U.S. economic data, the Federal Reserve, the U.S. dollar, and today’s key reports.

Although gold prices rose above $2,000 due to the surprise oil output cuts by OPEC+ and weak U.S. economic data, some profit-booking and an uptick in the dollar have led to a cool-off in prices.

Investors are looking forward to Friday’s U.S. non-farm payrolls report, which could create a highly volatile session, but gold could bounce back due to continued weak indicators and steady central bank buying.

Asian Gold Demand Slows

Physical gold demand in key Asian hubs has slowed down due to high domestic prices, forcing dealers in some markets to offer discounts.

The upcoming U.S. non-farm payrolls report will follow weak manufacturing and services sector data, reigniting concerns about the risk of a recession.

The Federal Reserve is scheduled to meet in May, and the market is divided over whether the central bank will pause or raise rates by another 25 basis points.

Investors are closely monitoring the impact of the Fed’s monetary policy tightening on the economy, with last week’s jobless claims figures and the nonfarm payrolls report providing more clues.

Daily June Comex Gold Technical Analysis

The main trend is up according to the daily swing chart. A trade through $2049.20 will signal a resumption of the uptrend. A move through $1965.90 will change the main trend to down.

The nearest support is a minor pivot at $2007.60.

Daily June Comex Gold Technical Forecast

Trader reaction to $2037.70 will determine the direction of the June Comex gold market on Thursday.

A sustained move over $2037.70 will indicate the presence of buyers. If this creates enough upside momentum to overcome the minor top at $2049.20 then we could see a near-term surge into $2097.20, the March 8, 2022 main top.

A sustained move under $2037.60 will signal the presence of sellers. This could lead to a test of the minor pivot at $2007.60. Buyers are likely to return on a test of this level since the market is still in an uptrend and traders will be looking to re-enter on dips.