GOLD faces rejection once again above $4,100, US PMIs eyed
Gold stays depressed below $4,100 early Friday, keeps range-trade in play.
US Dollar consolidates below six-month highs amid risk-off mood, Fed’s policy uncertainty.
Gold eyes a sustained move above $4,100 amid bullish daily RSI, while 21-day SMA support holds.
Gold is struggling for a direction, while trading under the $4,100 mark early Friday, although remaining confined in a familiar range. Despite the range-play, Gold is set to end the week on a subdued note.
Markets remain wary about whether the US will cut or not cut interest rates in December, especially after the dated September US employment report released Thursday.
The headline US NFP rose by 119,000 in September, following a 4,000 decrease (revised from +22,000) recorded in August. The reading outpaced the market forecast of 50,000.
Meanwhile, the Unemployment Rate rose to 4.4% from 4.3% in this period. The mixed data provided an ambiguous picture of the Fed’s path forward on interest rates.
However, markets continued to price in about a 40% chance that the Fed will lower rates next month as policymakers remained cautious on further monetary policy easing.
“Cleveland Fed President Beth Hammack warned on Thursday that cutting rates further right now carries a wide range of risks for the economy. Fed Governor Lisa Cook sees a risk of outsized asset price declines.”
The hawkish sentiment surrounding the Fed is weighing on non-yielding assets such as Gold. But Gold’s downside appears cushioned by the tech sell-off on Wall Street and later in the Asian markets as the solid Nvidia earnings-led rally faded.
Expectations of a massive economic stimulus package due to be unveiled by Japan’s government later on Friday also help keep Gold buyers hopeful. The package is estimated to be worth over JPY 20 trillion, the biggest since COVID-19.
Traders now eagerly await the S&P Global preliminary PMI data for November from the US for fresh insights on the health of the US economy The data could help markets reprice Fed rate cut expectations, eventually impacting Gold price action.
The US Manufacturing PMI is set to fall to 52 in November from 52.5 in October. The Services PMI is likely to stay unchanged at 54.8 in the reported period.
Daily technical analysis
In the daily chart, XAU/USD trades at $4,065.29. The 50-, 100-, and 200-day SMAs advance while price holds above them, maintaining a bullish bias. The 21-day SMA has flattened and edged lower, with $4,044.66 offering nearby dynamic support. The RSI stands at 52.00 , reflecting balanced momentum after the recent rebound.
Measured from the $4,381.17 high to the $3,885.84 low, the 38.2% retracement at $4,075.05 acts as near-term resistance, and a daily close above it would open the 50% retracement at $4,133.50. With momentum neutral and trend support intact, the path of least resistance would improve on a break of this barrier, while failure to clear it would keep gains capped and risk a return to the rising averages.
GOLD faces rejection once again above $4,100, US PMIs eyed
Gold is struggling for a direction, while trading under the $4,100 mark early Friday, although remaining confined in a familiar range. Despite the range-play, Gold is set to end the week on a subdued note.
Markets remain wary about whether the US will cut or not cut interest rates in December, especially after the dated September US employment report released Thursday.
The headline US NFP rose by 119,000 in September, following a 4,000 decrease (revised from +22,000) recorded in August. The reading outpaced the market forecast of 50,000.
Meanwhile, the Unemployment Rate rose to 4.4% from 4.3% in this period. The mixed data provided an ambiguous picture of the Fed’s path forward on interest rates.
However, markets continued to price in about a 40% chance that the Fed will lower rates next month as policymakers remained cautious on further monetary policy easing.
“Cleveland Fed President Beth Hammack warned on Thursday that cutting rates further right now carries a wide range of risks for the economy. Fed Governor Lisa Cook sees a risk of outsized asset price declines.”
The hawkish sentiment surrounding the Fed is weighing on non-yielding assets such as Gold. But Gold’s downside appears cushioned by the tech sell-off on Wall Street and later in the Asian markets as the solid Nvidia earnings-led rally faded.
Expectations of a massive economic stimulus package due to be unveiled by Japan’s government later on Friday also help keep Gold buyers hopeful. The package is estimated to be worth over JPY 20 trillion, the biggest since COVID-19.
Traders now eagerly await the S&P Global preliminary PMI data for November from the US for fresh insights on the health of the US economy The data could help markets reprice Fed rate cut expectations, eventually impacting Gold price action.
The US Manufacturing PMI is set to fall to 52 in November from 52.5 in October. The Services PMI is likely to stay unchanged at 54.8 in the reported period.
Daily technical analysis
In the daily chart, XAU/USD trades at $4,065.29. The 50-, 100-, and 200-day SMAs advance while price holds above them, maintaining a bullish bias. The 21-day SMA has flattened and edged lower, with $4,044.66 offering nearby dynamic support. The RSI stands at 52.00 , reflecting balanced momentum after the recent rebound.
Measured from the $4,381.17 high to the $3,885.84 low, the 38.2% retracement at $4,075.05 acts as near-term resistance, and a daily close above it would open the 50% retracement at $4,133.50. With momentum neutral and trend support intact, the path of least resistance would improve on a break of this barrier, while failure to clear it would keep gains capped and risk a return to the rising averages.
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