Gold Price Forecast: Profit-Taking Stalls Rally Ahead of NFP Report

Author: James Hyerczyk

Published: January 07, 2026

Key Points

• Gold prices are experiencing a pullback from record highs due to intensified profit-taking ahead of the Non-Farm Payrolls (NFP) report.
• The critical support level to watch is the 50-day moving average at $4,202, which is pivotal for the ongoing gold rally.
• Spot gold is testing a key retracement zone between $4,405 and $4,436 as traders reassess geopolitical tensions in Venezuela and the strength of the U.S. dollar.

Market Overview

Spot Gold (XAUUSD) has seen a decline as traders react to an unexpected surge earlier in the week, leading to profit-taking. The recent U.S. military action in Venezuela initially drove prices higher due to increased geopolitical risks, but the subsequent calm has prompted investors to secure profits.

As of 13:32 GMT, XAUUSD is trading at $4,445.89, down $48.74 or -1.08%.

Impact of the U.S. Dollar

The strength of the U.S. dollar has offset speculation regarding potential rate cuts by the Federal Reserve. Despite dovish comments from the Fed and weaker economic data, the dollar has strengthened, which has contributed to the bearish sentiment in gold.

Upcoming Economic Data

Traders are positioning themselves ahead of the critical jobs data set to be released on Friday. Prior to the NFP report, additional data such as the ADP Non-Farm Employment Change report, ISM Services PMI, and JOLTS Job Openings will provide further insights into the labor market.

Technical Analysis

The main trend for gold remains upward. A trade above the record high of $4,536.74 would signal a continuation of this trend, while a drop below $4,274.02 could indicate a reversal. The 50-day moving average at $4,202 is crucial; if breached with significant selling pressure, it could lead to a sharp decline in prices.

Currently, gold is testing its short-term retracement zone between $4,436.38 and $4,405.38. Holding above this zone suggests strong buying interest, while a failure to maintain this support could lead to a pullback towards $4,274.02.

Conclusion

The upcoming jobs report will significantly influence gold prices. A strong labor market report may delay Fed rate cuts, potentially exerting downward pressure on gold. Conversely, a weak jobs outlook could prompt the Fed to consider rate cuts, which would likely support a rally in gold prices.

About the Author

James Hyerczyk is a seasoned technical analyst and educator with over 40 years of experience in market analysis and trading, specializing in chart patterns and price movement. He has authored two books on technical analysis and has a background in both futures and stock markets.