The Gold Spot Price (XAUUSD) has remained steady in anticipation of today’s non-farm payrolls release. While predictions suggest a decline from 209K to 200K, it’s worth noting that NFP has defied expectations in the past. Concerning labour market data has put pressure on the yellow metal, prompting calls for further intervention from the Fed; hence NFP could serve as the cherry on the cake, ultimately bolstering the USD. 

Amidst a flurry of macroeconomic data in the US, the Gold Spot Price has struggled to gain traction. Initial jobless claims increased to 227K from 221K, and the ADP employment figure fell to 324K from the previous month’s 455K, albeit still nearly doubling the forecasted 189K. Additionally, the ISM Services PMI declined to 52.7 from 53.9, though it remains in expansionary territory, falling short of the forecast of 53. The S&P Global Manufacturing PMI also disappointed, dropping more than expected from 54.4 to 52.3, below the forecast of 52.4. With an expected drop in NFP, and an unwavering unemployment rate, the prospect of an interest rate hike becomes increasingly imminent while Gold fades into the background. 

Technical 

The Gold Spot Price is slipping on the prospect of another rate hike from the Fed. The price action ticked up and established resistance at $1971.33 per ounce, falling below the 50-day moving average, which encouraged downside momentum towards the $1933.07 per ounce support at the Golden Ratio.  

If the NFP release supports a steady Golden Ratio, the spot price may be encouraged to retest the $1953.87 per ounce resistance at the 38.20% Fibonacci level, which may pave the way towards the $1987.56 major resistance. However, a breakdown of the price action at the $1933.07 per ounce support could encourage a pullback towards the $1918.25 per ounce support at the 78.60% Fibonacci level. 

Summary 

The Gold Spot Price is rearing down a slippery slope due to woeful macroeconomic data in the US, increasing the likelihood of an interest rate hike from the Fed. If NFP surprises with an increase, the $1933.07 per ounce support could hold, which could bolster the Spot Price towards the $1971.33 per ounce resistance. However, a breakdown at the Golden Ratio may edge the price action towards the $1899.38 per ounce major support. 

Sources: TradingView, Reuters, Trading Economics 

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