Gold Technical Analysis – All Eyes on the US NFP Report

Overview

Gold prices have been on a steady upward trajectory, supported by expectations of Federal Reserve easing and a weaker US dollar. The market is currently in a state of anticipation as it awaits the Non-Farm Payroll (NFP) report, which is expected to influence future price movements.

Daily Timeframe Analysis

On the daily chart, gold has shown resilience, bouncing off a significant upward trendline. This bounce indicates strong buying interest, positioning traders for a potential rally towards new all-time highs. Sellers are advised to wait for the price to reach the resistance level at 3438 or to break below the major trendline before considering new short positions.

4-Hour Timeframe Analysis

The 4-hour chart reveals that gold has broken above a minor downward trendline, which had been defining bearish momentum. Although buyers entered the market following this breakout, momentum has since slowed as traders await the NFP report. For risk management, buyers may find a favorable risk-to-reward setup near the recent swing low at 3327, while sellers will look for a break below this level to target the major upward trendline.

1-Hour Timeframe Analysis

In the 1-hour timeframe, gold is currently consolidating as it approaches the NFP report. The market is experiencing high volatility, which may lead to unpredictable price movements. If the NFP data comes in soft, it could encourage buyers to enter the market more aggressively, increasing bets on rate cuts. Conversely, a strong report could push prices back towards the major trendline as market participants adjust their easing expectations.

Upcoming Catalysts

Key economic data releases, including the US NFP, Jobless Claims, and ISM Services PMI, are set to be announced before the US holiday. These reports will be crucial in determining the short-term direction of gold prices.