Gold closed in the positive territory on Wednesday and preserved its bullish momentum on Thursday. In the view of FXStreet’s Eren Sengezer, XAU/USD is set to post additional gains with a daily close above $1,800.
See – Gold Price Analysis: Softer demand from central banks and jewellery to cap any upside – HSBC
Focus shifts to Friday’s US labour market report
“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.”
“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 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).”
“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).”
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