- US ISM Services PMI Shows Positive Output in August
- Weaker US Labor Market Sparks Speculation of Larger Interest Rate Cut
- Gold Holds Above $2,500 Despite Loss of Bullish Strength
Spot Gold hit a peak of $2,523.45 per troy ounce on Wednesday, with the US Dollar weakening ahead of key US data releases. The country’s employment data revealed a softening labor market, leading to expectations of a more significant rate cut by the Federal Reserve this month. However, growth data showed resilience in the economy, causing mixed reactions in the markets.
The ADP Employment Change report indicated only 99,000 new jobs added in August, falling short of expectations. Additionally, Challenger Job Cuts spiked to a 15-year high, while Initial Jobless Claims slightly missed estimates. Despite these figures, the US Dollar recovered after the release of the ISM Services PMI, which exceeded forecasts.
As Wall Street fluctuated and Treasury yields remained subdued, focus turned to the upcoming Nonfarm Payrolls (NFP) report. With expectations of 160K new jobs added and a slight decrease in the Unemployment Rate, market analysts may revise their forecasts following recent tepid data.
Short-Term Technical Outlook for XAU/USD
XAU/USD pulled back from its peak and currently trades around $2,510. Technical indicators suggest a potential upside, with the 20 SMA providing support. However, RSI is the only indicator showing strength, limiting bullish momentum. In the short term, a consolidative phase is likely before the NFP report.
Support Levels: $2,498.00, $2,489.60, $2,475.70
Resistance Levels: $2,519.75, $2,531.60, $2,545.00
