Gold Steady Near $1,732 – Eyes on the US Nonfarm Payroll

During Friday’s Asian session, gold price cheers the US dollar’s pullback from a nearly two-decade high, extending the recovery to $1,750. Nonetheless, the metal GOLD has renewed its intraday high near $1,745 as of press time.

The US Dollar Index (DXY) falls 0.20 percent as the market braces for today’s US jobs report. The improvement in the risk profile amid repeated comments from prominent central bankers and efforts to calm recession fears, not to mention headlines about China, is also weighing on the greenback versus the six major currencies. It’s worth noting that the Doji candlestick at a multi-year high on Thursday joins the overbought RSI in considering the DXY.

However, according to Reuters, James Bullard, President of the Federal Reserve Bank of St. Louis, “we have a good chance at a soft landing.” Furthermore, Federal Reserve Governor Christopher Waller stated that inflation is far too high and does not appear to be easing and that the Fed must adopt a more restrictive policy.

XAU/USD

On the other hand, US President Joe Biden is scheduled to meet with his senior advisors on Friday to discuss China’s tariff policy. Previously, US and Chinese diplomats indicated a personal meeting after the latest virtual trade talks saw progress. With this, Beijing is optimistic that it can help alleviate the United States’ inflationary problem by resolving the supply-chain puzzle; however, experts were less enthusiastic. According to Bloomberg, China is also ready to spend $220 billion on stimulus through unprecedented bond sales.

The DXY was also weighed down by mixed data from the US, as initial jobless claims increased by 4,000 to 235,000 in the week ending July 2 versus 230,000 anticipated. The four-week moving average was 232,500, up 750 from the preceding week’s average. Furthermore, the US goods and services deficit shrank by $1.1 billion in May to $85.5 billion, the smallest monthly deficit since 2022.

Among these bets, US 10-year Treasury yields have faded from the two-day rebound, while S&P 500 Futures have remained directionless at the latest. Following that, updates from Biden’s meeting on China tariffs will be combined with US employment data for June to guide short-term gold price movements.

Gold Technical Outlook

The recent trades of the gold price are confined within a bearish flag pattern that appears on the chart; thus, the price needs to break the 1738.00 level to get a distinct value motive that will assist in rallying towards our main waited target of 1700.00.

As a result, the bearish trend scenario will remain in force and active for the foreseeable future, bolstered by the negative signal provided by stochastic, reminding you that staying below the 1765.00 and 1780.25 levels is critical to continuing the expected decline.

Today’s trading range is expected to be between 1720.00 support and 1760.00 resistance.

Today’s expected trend is bearish.