Gold (XAU) Daily Forecast: Bearish Momentum Builds as $2,500 Resistance Holds

Market Overview

During Monday’s Asian session, Gold (XAU/USD) saw an uptick, trading around $2,486 and reaching an intra-day high of $2,500. The increase followed unimpressive U.S. employment data, sparking concerns about the strength of the economy.

The U.S. Bureau of Labor Statistics reported a Nonfarm Payrolls (NFP) increase of 142,000 for August, falling short of the 160,000 forecast.

Additionally, unemployment dipped to 4.2% from 4.3%, with wage inflation rising to 3.8%. This has lowered expectations for a significant 50 basis point rate cut by the Federal Reserve.

Stronger Dollar Caps Gold’s Gains

Despite the weak job numbers, the U.S. Dollar (USD) gained strength due to a modest recovery in U.S. Treasury yields.

According to the CME Group’s FedWatch tool, the market is pricing in a 70% chance of a 25 basis point rate cut, down from earlier expectations of a 50 basis point cut.

As the U.S. Dollar firmed, gold’s upward movement was limited, with further gains capped by higher Treasury yields.

Geopolitical Concerns Push Safe-Haven Demand

Geopolitical uncertainty continues to support gold’s demand as a safe-haven asset. Beyond tensions in the Middle East, China’s gold holdings remained steady at 72.8 million fine troy ounces, according to the People’s Bank of China (PBOC).

Meanwhile, China’s inflation data showed consumer prices rising for the seventh consecutive month, though producer price deflation persisted.

Short-Term Forecast

Gold is trading at $2,486.75, testing key resistance at $2,500. A break above this level could target $2,511, while support lies at $2,471.

Gold Prices Forecast: Technical Analysis

Gold (XAU/USD) is trading at $2,486.75, down 0.20%, and is facing key resistance at $2,500.11, which serves as the pivot point on the 2-hour chart. If gold breaks above this level, it could test further resistance at $2,511.34 and $2,529.14.

On the downside, immediate support lies at $2,471.90, with deeper support levels at $2,451.91 and $2,432.19. The 50-day EMA sits at $2,503.33, reinforcing resistance, while the 200-day EMA at $2,493.61 suggests some underlying strength.

A break above $2,500 could signal a bullish trend, but failure to do so keeps the bearish outlook intact. Watch these levels for potential moves.