- XAU/USD is rising toward key resistance area on Thursday.
- USD continues to have a difficult time finding demand.
- Focus shifts to Friday's US labour market report.
The XAU/USD pair closed in the positive territory on Wednesday and preserved its bullish momentum on Thursday. As of writing, the pair was trading in the upper half of its weekly range, rising 0.25% on the day at $1,791.
The selling pressure surrounding the greenback is allowing XAU/USD to edge higher. Reflecting the broad-based USD weakness, the US Dollar Index is losing 0.25% at 91.03. On the other hand, the 10-year US Treasury bond yield, which lost nearly 4% in the first half of the week, is staging a rebound and limiting gold's gains for the time being.
The data published by the US Department of Labor revealed on Thursday that the weekly Initial Jobless Claims declined to the lowest level since the beginning of the pandemic at 498,000. This reading came in better than the market expectation of 540,000 but failed to help the USD find demand as investors remain on the sidelines ahead of Friday's key jobs report.
Nonfarm Payrolls (NFP) in the US is expected to increase by 978,000 in April. Furthermore, analysts see the Unemployment Rate edging lower to 5.8% from 6% in March. Market participants will also pay close attention to the Average Hourly Earnings, as stronger-than-expected wage inflation could provide a boost to T-bond yields and force gold to reverse its direction.
Gold technical outlook
The Relative Strength Index (RSI) indicator on the daily chart is inching higher on Thursday. However, gold may need to make a daily close above $1,800, where the 100-day SMA is currently located, in order to attract buyers. Above that level, $1,820 (Fibonacci 50% retracement of the January-March downtrend) aligns as the next target ahead of $1,840 (static level).
On the flip side, the near-term outlook could turn bearish if gold violates the 20-day SMA at $1,770. $1,755 (static level) could act as interim support before $1,740 (50-day SMA/Fibonacci 23.6% retracement).
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
EUR/USD stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.