- Gold price takes a breather after a three-day downtrend, awaiting US jobs data.
- The US Dollar stays weak with Treasury bond yields, despite US and China woes-led risk-aversion.
- Gold price bounces off key 21-day SMA, a rebound in the offing amid bullish daily RSI.
Gold price is treading water below the $2,500 threshold in Asian trading on Wednesday, with sellers catching their breath after three consecutive days of decline and ahead of the highly-anticipated US Job Openings data for July.
Gold price awaits US jobs data for fresh cues on Fed policy
Gold price is consolidating the previous sharp bounce from eight-day lows of $2,473, as Asian traders react to the weak US Institute for Supply Management (ISM) Manufacturing PMI data, which raised concerns over a potential ‘hard-landing for the US economy.
The ISM announced on Tuesday that its headline US Manufacturing Index improved slightly to 47.2 in August from July’s 46.8 but remained in contraction while coming in below the estimated 47.5 print. Soft US data ramped up bets for a 50 basis points (bps) interest-rate cut by the US Federal Reserve (Fed) this month.
Markets raised odds of a 50 bps Fed rate cut on September 18 to 38% from 31% a day earlier, according to the CME Group's FedWatch Tool. Currently, the probability of such a move stands at 41%.
Increased bets of aggressive policy easing by the Fed is likely to keep the demand for the non-interest-bearing Gold price afloat, allowing buyers to regain control.
Additionally, Gold price could also draw support from hopes of fresh policy support measures due on the cards from China, following a string of disappointing business PMI data. On Wednesday, China’s Caixin Services PMI dropped to 51.6 in August versus July’s 52.1 and 52.2 forecast.
Looking ahead, if risk-aversion intensifies and bolsters the haven demand for the Japanese Yen (JPY), Gold price and US government bonds, the US Dollar (USD) could come under fresh selling pressure, courtesy of the JPY advance-led sell-off in the USD/JPY.
However, the US Job Openings Survey data could provide fresh hints in determining the size of the September Fed rate cut, which would have a significant impact on the US Dollar trades and the USD-denominated Gold price.
Gold price technical analysis: Daily chart
The short-term technical outlook for Gold price remains constructive so long as buyers hold above the 21-day Simple Moving Average (SMA) at $2,485.
The 14-day Relative Strength Index (RSI) has rebounded slightly while above the 50 level, suggesting that an upswing looks likely going forward.
On the upside, recapturing the $2,500 level on a daily closing basis is critical for Gold price to resume its upward trajectory. The next relevant topside barrier is seen at the record high of $2,532, above which the $2,550 psychological level will be tested.
If the corrective downside regains momentum, Goild price could challenge the 21-day SMA at $2,485 once again, below which the symmetrical triangle resistance-turned-support at $2,462 will come into play.
A fresh downtrend would initiate below that support level, with sellers aiming for $2,425 area, where the triangle support line and the 50-day SMA close in.
Economic Indicator
JOLTS Job Openings
JOLTS Job Openings is a survey done by the US Bureau of Labor Statistics to help measure job vacancies. It collects data from employers including retailers, manufacturers and different offices each month.
Read more.Next release: Wed Sep 04, 2024 14:00
Frequency: Monthly
Consensus: 8.1M
Previous: 8.184M
Source: US Bureau of Labor Statistics
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
![Australian Dollar breaks two-day winning streak despite the hawkish RBA](https://editorial.fxstreet.com/images/Markets/Currencies/Majors/AUDUSD/australian-currency-23690700_XtraSmall.jpg)
Australian Dollar breaks two-day winning streak despite the hawkish RBA
The Australian Dollar (AUD) halts its two days of gains against the US Dollar (USD) as traders adopt caution ahead of the release of US Nonfarm Payrolls (NFP). This data may offer more cues on the potential size of an expected rate cut by the Federal Reserve (Fed) this month.
![Japanese Yen extends winning streak as US Dollar remains subdued due to dovish Fedspeak](https://editorial.fxstreet.com/images/Markets/Currencies/Majors/USDJPY/japanese-yens-7972406_XtraSmall.jpg)
Japanese Yen extends winning streak as US Dollar remains subdued due to dovish Fedspeak
The Japanese Yen (JPY) continues its winning streak for the fourth successive session as rising real wages in July fuel speculation that the Bank of Japan (BoJ) may introduce another interest rate hike before the end of 2024. Additionally, the USD/JPY pair has encountered headwinds due to a softer US Dollar (USD), driven by dovish comments from Federal Reserve (Fed) officials.
![Gold price bulls turn cautious near $2,525 hurdle ahead of US NFP report](https://editorial.fxstreet.com/images/Markets/Commodities/Metals/Gold/stack-of-golden-bars-in-the-bank-vault-60756080_XtraSmall.jpg)
Gold price bulls turn cautious near $2,525 hurdle ahead of US NFP report
Gold price (XAU/USD) climbed closer to the $2,524-2,525 supply zone on Thursday amid some follow-through US Dollar (USD) selling, led by bets for a larger interest rate cut by the Federal Reserve (Fed) later this month.
![Why Ethereum is underperforming Bitcoin, Solana, Nvidia, Meta, Apple and others](https://editorial.fxstreet.com/images/Markets/Currencies/Cryptocurrencies/Coins/Ethereum/ethereum_XtraSmall.jpg)
Why Ethereum is underperforming Bitcoin, Solana, Nvidia, Meta, Apple and others
Ethereum (ETH) is down 2% on Thursday following a key analysis showing the top altcoin has underperformed assets, including Bitcoin, Solana, Nvidia, Meta, Apple, Gold and others. CryptoQuant analysts and the F2pool co-founder weigh in on why ETH has underperformed and what investors should expect.
![ADP Employment Change Preview: US private sector expected to add 145K new jobs in August](https://editorial.fxstreet.com/images/Macroeconomics/EconomicIndicator/Employment/employment-51256484_XtraSmall.jpg)
ADP Employment Change Preview: US private sector expected to add 145K new jobs in August
ADP Employment Change is forecast to arrive at 145,000 in August. Labor market conditions could influence the Fed’s policy outlook. The US Dollar stays resilient against its rivals after posting large losses in August.
![Moneta Markets review 2024: All you need to know](https://editorial.fxstreet.com/images/IT/Testing/Review/FXSBadgeCertifiedBackg_XtraSmall.png)
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.