Spot Gold is currently trading at $2,496.69, just below the key $2,500 level, after bouncing back from a weekly low. The positive momentum comes after weaker-than-anticipated United States employment data was released, lifting market sentiment. The US Treasury yield curve also turned flat, easing recession fears and supporting risk appetite.
The latest JOLTS Job Openings report showed a significant drop in job openings, signaling a weakening labor market and increasing speculation that the Federal Reserve may implement a 50 basis points rate cut in the upcoming meeting. This news has boosted investor confidence and led to gains in equities, putting pressure on the US Dollar.
Looking ahead, market participants are eagerly awaiting the Nonfarm Payrolls report and the ADP Employment Change figure, which will provide further insights into the health of the US labor market. Additionally, the flattening of the US Treasury yield curve is seen as a positive sign for high-yielding assets, potentially limiting Gold’s upside potential.
Technical Analysis: XAU/USD Outlook
On the daily chart, XAU/USD shows signs of bullish momentum as buyers continue to step in on dips. The pair is currently trading above the 20 Simple Moving Average, with technical indicators consolidating in positive territory. However, on the 4-hour chart, the price is facing resistance at the $2,500 level and may retest the recent low if it fails to break higher.
Support Levels: 2,489.60, 2,475.70, 2,463.40
Resistance Levels: 2,507.40, 2,519.75, 2,531.60
Overall, Gold prices are seeing a surge in demand as weak US economic data and a flat yield curve boost investor sentiment. Investors should keep a close eye on upcoming reports and technical levels to make informed trading decisions.