Gold price (XAU/USD) has gained nearly 1.62% as it surges above the $1800 price level for the first time since 23 February. The huge gain on the day comes on the back of lower US long-term bond yields, which have receded for the 5th day in a row. Additional selling pressure on the greenback was also responsible for the strong push by the yellow metal on Thursday.
The focus now shifts to Friday’s Non-farm Payrolls report. On Thursday, the Department of Labour reported the lowest initial jobless claims figure in a year. In the week ended May 1, first-time unemployment claims fell to 498K, lower than the 590K registered previously (an upward revision) and the 540K that the markets expected.
The market expects a slight addition in the Non-farm employment change (from 916K previously to 990K), with a reduction in the unemployment rate from 6.0% to 5.8%.
Perhaps the market may respond the most to the Average Hourly Earnings, as investors seek clues that point to higher inflation. If this metric exceeds 0.0%, the wage inflation created could spark talk of rates being raised sooner, which favors bond yields but is bad for gold prices.
Technical Outlook for Gold
The daily chart of the XAU/USD asset shows that gold price has hit resistance at the 1815.20 mark. The gold price needs to overcome this level to attain the floor of the supply zone that rests between 1828.55 and 1840.55. Only if bulls surpass this zone can 1851.23 become available. Further targets lie at 1881.68 and 1900.95.
On the other hand, a pullback from this area targets the 1800 psychological support level, with the 1789.49 support price and 1763.30 serving as additional downside targets.
Don’t miss a beat! Follow us on Telegram and Twitter.
XAU/USD Daily Chart
