Gold Price Forecast: XAU/USD Is On The Key Support And Waiting For Next Action
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Gold holds steady

Author: Mr. Amar – Technical Analyst

After FOMC meeting, gold seems to have change it course from to November’s high at $1877 towards December’s low at $1855 when Fed announced hawkish decision rates. The price of gold trades to a fresh monthly low at $1780 as the Federal Reserve unveils a more detailed exit strategy, and fresh data prints coming out of the US may keep bullion under pressure as the Non-Farm Payrolls (NFP) report is anticipated to show a further improvement in the labor market.

The update to the US NFP report may put pressure on the FOMC to normalize monetary policy sooner rather than later as the economy anticipated to add 200K jobs in January, and a further improvement in the labor market may drag on the price of gold as it fuels speculation for an imminent Fed rate hike. According to analysts at TD Securities, more regional surveys for January will be released early next week, so expectations could change, but the surveys already released point to declines in both ISM indexes. Weakening can likely be explained in large part by temporary fallout from Omicron, but a fading of the boost from fiscal stimulus is probably causing some slowing as well.

Technically, gold looks for opportunity to be pushed higher as it now traded at key support level. The prediction for XAU/USD would be that price will now climb higher pass $1800 and make new high, then fall back towards $1790 as retracement before continue its trend. This week’s NFP, ISM Manufacturing PMI and JOLTS Job Opening will be eyed for any drastic changes and impacting US dollar currencies index.