10 Jan 2025

• Gold price consolidates near the monthly high of $2,678 on US Nonfarm Payrolls Friday.
• Concerns over Trump’s policies offset the US Dollar strength and elevated Treasury bond yields.
• Can US NFP data change the course in Gold price, with a Bear Cross in play? 
• Gold prices are stabilizing after achieving weekly gains, remaining just beneath the one-month peak of $2,678 reached on Thursday. Traders are keenly anticipating the release of the US Nonfarm Payrolls (NFP) data to inform their new investment decisions.

• The upcoming US Non-Farm Payroll data is anticipated to significantly influence the next movement in Gold prices.

  The price of gold remains bolstered by heightened demand for safe-haven assets, which outweighs the ongoing robustness of the US Dollar (USD) and the yields on US Treasury bonds. Concerns regarding inflation have been heightened by the anticipated effects of the forthcoming immigration and trade policies under US President-elect Donald Trump, thereby enhancing gold's attractiveness as a hedge against inflation and as a conventional safe-haven investment.

  Expectations for fewer interest rate reductions by the US Federal Reserve this year, coupled with economic concerns in China, are sustaining a positive sentiment around the US Dollar, which remains near weekly peaks against its primary currency counterparts. The yields on US benchmark 10-year Treasury bonds have reached eight-month highs, exceeding 4.68%, which somewhat constrains upward movements in the non-yielding Gold price.
  
  Additionally, market participants are exhibiting risk aversion and are hesitant to make directional investments in Gold, particularly in light of the typical caution observed before the Non-Farm Payroll (NFP) report. The US economy is projected to generate 160,000 jobs in December, following an increase of 227,000 jobs in November. The Unemployment Rate and Average Hourly Earnings are anticipated to hold steady at 4.2% and 4%, respectively, during this period.
  
  Should the NFP report reveal weaker-than-expected job growth, it may reignite expectations for aggressive rate cuts by the Fed, potentially leading to a significant correction in the US Dollar and further supporting the ongoing uptrend in Gold prices. Conversely, a stronger-than-expected NFP report along with rising wage inflation could bolster hawkish sentiments regarding Fed policy, negatively impacting Gold prices.
  
  Moreover, market participants may engage in profit-taking on Gold positions ahead of the upcoming US Consumer Price Index (CPI) data. Nevertheless, ongoing speculation regarding Trump’s policies may continue to influence market dynamics, providing substantial support for Gold prices as the weekend approaches.
  

  The daily chart indicates that the 14-day Relative Strength Index (RSI) remains comfortably above the midpoint, currently positioned around 57.50, which supports the ongoing upward movement in Gold prices. Furthermore, Gold prices concluded Tuesday above the established resistance level of $2,665.
  
  Nevertheless, buyers may exercise caution as the 21-day Simple Moving Average (SMA) has recently crossed below the 100-day SMA on a daily closing basis, signaling a Bear Cross.
  
  In light of the mixed signals from daily technical indicators, the upcoming US Non-Farm Payroll (NFP) report may determine the next trajectory for Gold prices.
  
  Should the NFP report fall short of expectations, Gold prices could extend their four-day rally and test the December 13 peak of $2,693, surpassing the four-week high of $2,678.
  
  The subsequent resistance levels are identified at the $2,700 mark and the December 12 high of $2,726.
  
  Conversely, robust payroll figures could reinvigorate Gold sellers, potentially driving prices down towards the 50-day SMA at $2,643, below which the convergence of the 21-day SMA and the 100-day SMA at $2,633 would be scrutinized.
  
  The critical support level for Gold buyers is established at the January 6 low of $2,615.