• Gold price remains confined in a tight range between two key technical barriers.     
• The US dollar and treasury yields attempt recovery after the Fed Chair Powell slump.
• Gold price lacks a clear directional bias amid a neutral daily RSI, eyeing US Nonfarm Payrolls.

Gold’s price continues with its narrow range struggle at around $2,650 early Thursday, stalling Federal Reserve (Fed) Chairman Jerome Powell’s speech-led uptick. The focus now remains on the US Jobless Claims data due later in the day in the lead-up to the all-important Nonfarm Payrolls (NFP) data.

Gold price fails to defend Powell-led bid

Gold buyers seem to have turned cautious yet again, as the US Dollar (USD) and US Treasury bond yields recover from the overnight slump fuelled by Powell’s optimistic comments on the US economy at the New York Times’ DealBook Summit.

Powell said in his speech that “Growth is definitely stronger than we thought, and inflation is coming a little higher,” Powell said at the event. “The good news is that we can afford to be a little more cautious as we try to find neutral,” he added, referring to the neutral interest rate.

His comments powered the Wall Street indices to fresh highs on increased ‘soft-landing’ hopes, weighing on the safe-haven US Dollar while boosting Gold price. Fed Chair Jerome Powell’s words, however, failed to alter the market’s pricing of 25 basis points (bps) interest rate cut later this month, which weighed heavily on the US Treasury bond yields across the curve, aiding the rebound in Gold price.

Markets continue pricing in a 73% probability of a Dec Fed rate reduction, the CME Group’s FedWatch Tool shows, more or less the same as a day ago.

During the first half of Wednesday’s trading, Gold price struggled amid a modest US Dollar upswing, courtesy of a risk-averse market mood on China’s economic concerns, looming US-Sino trade tensions and geopolitical risks.

Looking ahead, the broader market sentiment will play a pivotal role in the Gold price action but traders could refrain from placing fresh directional bets on the bright metal, anticipating the high-impact US labor market report on Friday. Data released by the ADP showed Wednesday that US private sector employment grew by 146,000 jobs last month, lower than the 150,000 figure that analysts expected.

Markets will also pay close attention to any developments on the global trade front and Middle East geopolitics, which could significantly impact risk sentiment and the USD-sensitive Gold price. Earlier on, an adviser to US President-elect Donald Trump said that Trump “wants to implement an Israel-Gaza cease-fire deal Gaza without delay and before January 20.”

Gold price technical analysis: Daily chart

The daily chart shows that Gold’s price remains stuck between the critical short-term 21-day Simple Moving Average (SMA) at $2,636 and the 50-day SMA at $2,669.

The 14-day Relative Strength Index (RSI) sits just beneath the 50 level, suggesting a lack of clear directional bias.  

The previous week’s Bear Cross still remains a threat to Gold buyers.

Recapturing the 50-day SMA resistance at $2,669 on a daily closing basis is critical for buyers to affirm the recovery.

The next relevant resistance aligns at $2,700, above which the November 25 high of $2,721 will be tested.

Conversely, Gold sellers must find a foothold below the 21-day SMA at $2,636 to crack the $2,621 static support.

The previous week’s low of $2,605 will be the line in the sand for Gold buyers.

Gold Technical Forecast: XAU/USD Weekly Trade Levels

• Gold prices rebound off uptrend support- December opening-range in focus
• XAU/USD threat remains for larger correction with broader uptrend
• Resistance 2736 (key), 2804, 2900– Support 2607, 2532, 2450/82 (key)

Gold prices are virtually unchanged since the start of the week with XAU/USD trading just above multi-year slope support. The focus now shifts to the December opening-range with the broader uptrend still vulnerable to a deeper correction while below the record high-close. Battle lines drawn on the XAU/USD weekly technical chart.

Review my latest Weekly Strategy Webinar for an in-depth breakdown of this gold setup and more. Join live on Monday’s at 8:30am EST.

Gold Price Chart – XAU/USD Weekly

Chart Prepared by Michael Boutros, Sr. Technical Strategist; XAU/USD on TradingView

Technical Outlook: In last month’s Gold Weekly Price Forecast we noted that the gold sell-off was, “testing initial trend support at the median-line- risk for near-term price inflection here.” XAU/USD surged nearly 7.3% off those lows before exhausting into the close of the month. A decline of nearly 4.3% rebounded off the 61.8% retracement of the November rally at 2607 last week with price holding a tight range (virtually unchanged) into the weekly / monthly open.

Weekly resistance is eyed with the record high-week close (HWC) at 2736– a breach / close above this threshold is needed to mark uptrend resumption towards subsequent resistance objectives at 2.618% extension of the 2022 range breakout at 2804 and 2900 / the upper parallel.

Support remains at 2607 with a break / close below the median-line needed to suggest a more significant correction is underway. Subsequent support objectives rests with the August high at 2532 and 2450/82- a region defined by the April high and the 38.2% retracement of the 2024 yearly range. Losses should be limited to this zone for the 2022 uptrend to remain viable with a close below the 52-week moving average (currently ~2361) ultimately needed to suggest a larger trend reversal is underway / put the bears in control.

Bottom line: Gold is trading just above multi-year uptrend support into the start of the month and while the broader outlook remains constructive, the advance may be vulnerable to a larger correction within the broader uptrend. From a trading standpoint the immediate focus is on a breakout of the 2607-2736 range for guidance.

Keep in mind that we are in in the early throws of the December opening-range with US non-farm payrolls on tap Friday. Stay nimble into the release and watch the weekly close for guidance here. Review my latest Gold Short-term Outlook for a closer look at the near-term XAU/USD technical trade levels.

Key US Economic Data Releases

Economic Calendar – latest economic developments and upcoming event risk.

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— Written by Michael Boutros, Sr Technical Strategist with FOREX.com

Follow Michael on X @MBForex

Confluence Identifies Support Zone

Given the confluence of indicators pointing to potential support around 3.04 to 3.02 and the intraday recovery, there is a chance that today’s low ends the short-term correction. A return to the breakout level of 3.02 is typical as prior resistance levels are tested as support. The decisive rally above 3.02, a prior swing high, on November 20 triggered a bullish breakout of a symmetrical triangle pattern.

Once triggered the price of natural gas reclaimed the next two higher swings that construct the top of the triangle formation at 3.16 and 3.39, before peaking at a new trend high of 3.56. The 2023 peak is a little further up at 3.64. That was the highest traded price since January 2023.

Top Boundary Line of Triangle May Yet be Tested

Regardless of the potential for the 3.02 support zone to hold, there is also the top boundary line of the triangle a little lower, around 2.92, depending on when it might be reached. The line also defined resistance at the top of the triangle. It could still be tested as support. The line is joined by 2.90 and 2.88, the 127.2% extended target for the falling ABCD pattern and the 78.6% retracement level, respectively.

Daily Close Above 3.02 Wound Show Strength

A daily close above 3.02 would provide a small indication of strength that would need follow-through, and further still on a close above 3.04. Nonetheless, a bullish reversal would not be indicated until there was an advance above today’s low of 3.08, assuming there is not a new low for the current bearish retracement beforehand.

For a look at all of today’s economic events, check out our economic calendar.

• Silver price recovers strongly from $30.50 after US ADP Employment Change data misses estimates by a slight margin.
• Investors await Fed Powell’s speech for fresh guidance about the likely interest rate path.
• Traders expect the Fed to cut interest rates by 25 bps to 4.25%-4.50% on December 18.

Silver price (XAG/USD) recovers in a V-shape manner from the key support of $30.50 in Wednesday’s North American session and refreshes an intraday high near $31.20 after the release of the United States (US) ADP Employment Change data for November. The agency reported that the private sector hired fresh 146K workers, marginally missed estimates of 150K but was significantly lower from the former release of 184K, downwardly revised from 233K.

However, the private sector employment data has not weighed much on the US Dollar (USD). The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, surrenders nominal gains but holds the key support of 106.50. 10-year US Treasury yields hold onto gains near 4.27%.

Historically, higher yields on interest-bearing assets increase the opportunity cost of holding an investment in non-yielding assets, such as Silver. But it doesn’t appear in this case, suggesting that geopolitical tensions continue to maintain safe-haven demand.

According to Reuters, the Hamas internal statement has reported that the group has information that Israel intends to carry out a hostage rescue operation similar to Israel’s June nuseirat operation in Gaza, a move that could derail the ceasefire between Iran and Israel. The appeal of the Silver price strengthens in a heightened geopolitical environment.

Going forward, investors will focus on Federal Reserve (Fed) Chair Jerome Powell’s speech at the New York Times DealBook Summit for fresh guidance on interest rates. The probability for the Fed to cut interest rates by 25 basis points (bps) to 4.25%-4.50% is 74%, while the rest favors leaving them unchanged at their current levels, according to the CME FedWatch tool.

Silver technical analysis

Silver price strives to extend recovery above the 20-day Exponential Moving Average (EMA), which trades around $31.30.

The 14-day Relative Strength Index (RSI) oscillates in the 40.00-60.00 range, suggesting a sideways trend.

Looking down, the upward-sloping trendline around $29.50, which is plotted from the February 29 low of $22.30 on a daily timeframe, would act as key support for the Silver price. On the upside, the horizontal support plotted from the May 21 high of $32.50 would be the resistance zone.

Silver daily chart

XAU/USD Current price: $2,655.15

• Central banks’ leaders and US macroeconomic data set the market’s tone.
• The US Dollar seesaws between gains and losses ahead of Fed Powell’s words.
• XAU/USD extends its consolidative phase with no directional strength in sight.

Back and forth among financial markets did not impact Gold price on Wednesday, with the bright metal stuck around $2,650 a troy ounce. The US Dollar seesawed between gains and losses, on the one hand, backed by political jitters weighing on the mood, and on the other hand, losing ground on the back of tepid United States (US) data.

Also, central banks’ chiefs affected markets. Bank of England (BoE) Governor Andrew Bailey was the first to publicly appear, saying markets should expect the United Kingdom (UK) to keep cutting rates gradually next year as inflation eases. He added that the disinflation process is well embedded but that there’s more to do.

Next was European Central Bank (ECB) President Christine Lagarde, who testified before the European Parliament’s Committee on Economic and Monetary Affairs. Lagarde said that the economic growth in the EU will be weaker in the near term, adding the recovery should start to gather “some steam.” She added inflation is expected to temporarily increase in the last quarter of the year, and decline to target in the course of the next one.

Data-wise, the US released the ADP Employment Change report, showing the private sector added 146,000 new positions in November, below the 150,000 expected. Additionally, the ISM Services Purchasing Managers Index (PMI), which unexpectedly fell to 52.1 in November from 56 in the previous month, also missed the expected 55.5.

Still pending is a speech from Federal Reserve’s (Fed) Chairman Jerome Powell, due to participate in a moderated discussion at the New York Times DealBook Summit. The next first tier-event will take place on Friday, when the US will release the November Nonfarm Payrolls (NFP) report.

 XAU/USD short-term technical outlook

From a technical point of view, XAU/USD has made no progress. The daily chart shows it has held within familiar levels for a seventh consecutive trading day, albeit finding intraday support around a now flat 20 Simple Moving Average (SMA). The 100 and 200 SMAs advance below the current level but lose their upward strength. Finally, technical indicators remain within positive levels, with uneven upward strength, not enough to confirm a bullish extension.

In the near term, and according to the 4-hour chart, XAU/USD is neutral. All moving averages are flat, with the 200 SMA at around $2,678.35 and the shorter ones below the current level. Technical indicators stand above their midlines but lack directional strength. Gold may keep consolidating ahead of upcoming central banks’ meetings scheduled throughout the upcoming two weeks.

Support levels: 2,626.70 2,611.35 2,598.70  

Resistance levels: 2,671.55 2,688.65 2,700.00

Created on December 03, 2024

•  This makes a huge difference, due to the fact that the futures markets of course have the most liquidity during the US session.
• Furthermore, it’s worth noting that the contract that you are trading in is more likely than not a derivative of the Henry Hub Natural Gas contract, which reflects the price of natural gas delivered from Henry, Louisiana.

There is a cyclical trade to be had here, as it is typical for the winter months to bring in more demand for natural gas for heating. Most of the northeastern part of the United States uses natural gas for heating, or at least some type of other gas such as propane, so these markets do tend to move somewhat in tandem. Ultimately, I think you’ve got a situation where natural gas will continue to be thought of as a potential value play, at least on each and every dip.

The Cycle

The cycle will end sooner or later, but it is worth noting that the market participants out there will probably continue to push this market higher over the next month or 2. After a while, then you have to start looking at the futures markets that are pricing in spring temperatures, which obviously will start to warm up and therefore it makes a certain amount of sense that the market will start to fall again. This is something I do every year, and the share of course will be any different. The market had been somewhat straight up in the air for a while, so a little bit of consolidation between the $3.00 level and the $3.40 level, certainly makes a certain amount of sense. After all, the $3.40 level had been a massive barrier previously.

Ready to trade daily Forex analysis? We’ve made a list of the best commodity broker platforms worth trading with. 

SHANGHAI – Copper prices could fall towards $8 500 a metric ton within the next four months on expectations that demand will be hurt by potential trade disruptions when Donald Trump returns to the White House in January, copper industry participants said.

Benchmark three-month copper on the London Metal Exchange (LME) CMCU3 was traded at $8 915 a ton at 08:52 GMT, having shed 8% in less than 10 days since Trump won the US Presidential election.

The pressure on prices reflects heightened concerns around the impact on growth from potential trade policy from the new U.S. administration, analyst Nicholas Snowdon of Mercuria Energy Trading told the CRU World Copper Conference Asia.

Near-term prices are also being suppressed by the weight of inventory, Snowdon said, forecasting a surplus of nearly half a million tons in the first quarter of 2025 due to stock build-up during the Chinese New Year holiday starting in late January and demand weakness in the West.

“It is quite feasible that by March, we will be sitting on global cathode stocks of just over a million tons,” he said.

LME copper could fall to $8,500 by the end of the first quarter next year, most traders, producers, brokers and analysts surveyed by Reuters said during the annual copper industry gathering this week in Shanghai.

Others at the event said they expect prices to range between $9 000 to $9 500 next year, citing similar fundamentals to 2024.

A strong dollar, boosted by its safe haven status, will also make dollar-priced copper more expensive to holders of other currencies, said a broker and an analyst.

Citi analysts on Wednesday revised down their copper price forecast to $8 500 a ton within three months, from $9 500 previously, due to likely US trade tariff hikes and weaker-than-expected Chinese stimulus so far.

But prices are unlikely to fall below $8 500 because buyers would snap up copper at that level, which is more than 20% below the historic high hit in May this year of $11 104.50, a China-based analyst said.

Project Blue analyst Jonathan Barnes said LME copper prices could average between $9 300 to $9 400 over the next three months, with a near-term dip towards $8 500 possible as markets digest the implications of a Trump presidency, with 2025 prices seen averaging between $9 475 and $9 575.

In the longer-term, prices are likely to be supported by demand driven by possible Chinese stimulus moves next year, analysts said.

Copper prices are also cushioned by disruptions in mine supply, with analysts forecasting a deficit next year to range from 500,000 tons to above one-million tons, forcing smelters to cut cathode output.

CRU expects the copper price to recover to $10 000 by the end of March 2025 and potentially hit $15 000 by 2029, backed by energy transition demand and mine supply tightness.

“In the near term (there is) downside risk for price, but the structural story is not dead … and we do see that starting to prevail more through the mid-second half of next year,” Mercuria’s Snowdon said.

• Gold price stays supported near $2,650 ahead of US data and Fed Chair Powell’s speech.    
• The US Dollar derives strength from risk aversion on China’s woes and the Fed’s future rate cuts uncertainty.
• Technically, Gold price regains the 21-day SMA at $2,636, but the daily RSI flatlines near 50.

Gold price is holding onto minor bids early Wednesday, struggling to build on the previous bounce, anticipating a fresh batch of top-tier US economic data releases and Federal Reserve (Fed) Chairman Jerome Powell’s speech.   

Gold price looks to US ADP data and Powell for fresh cues

Tuesday’s US JOLTs Job Openings data indicated a stronger-than-expected labor market after rising to 7.744 million in the reported period. Data surpassed the expected 7.48M increase. The upbeat labor data from the US briefly lifted the US Dollar (USD) across the board, capping the Gold price rebound near $2,655.

However, Gold buyers retained control as the Greenback failed to sustain the uptick. The data failed to alter the market’s expectations of a 25 basis points (bps) interest rate cut by the Fed later this month. Markets are currently pricing at a 73% probability of a Dec Fed rate reduction, the CME Group’s FedWatch Tool shows, more or less the same as a day ago.

In Wednesday’s trading so far, Gold price is struggling to extend its upside as the USD remains in demand due to a risk-averse market environment. China’s economic concerns and US-Sino trade tensions continue to dent risk sentiment. China’s Caixin Services PMI unexpectedly dropped to 51.5 in November against the expected increase to 52.5 following October’s 52.0 figure.

On Tuesday, China’s Commerce Ministry announced a ban on exports of dual-use items related to gallium, germanium, antimony and superhard materials to the US with immediate effect, in response to the latest crackdown on China’s chip sector by US President Joe Biden’s administration.          

If risk-aversion intensifies, Gold price could face a tailwind effect as it is considered a traditional safety net. However, the next directional move in Gold price hinges on the US ADP Employment Change data and Fed Chair Powell’s speech. The US private sector is expected to see a job gain of 150K in November, compared to 233K in October.

A worse-than-expected labor data could revive expectations of future Fed rate cuts beyond December, fuelling a fresh advance in the non-interest-bearing Gold price. But any reaction to the US data is likely to be shorted-lived as Powell’s words are set to shape up the market expectations of the Fed’s easing trajectory, influencing Gold price action in the lead-up to Friday’s US Nonfarm Payrolls data.

It’s worth mentioning that it will be Powell’s last appearance before the Fed enters the ‘blackout period’ on December 7 ahead of the December 17-18 policy meeting.

Gold price technical analysis: Daily chart

The daily chart shows that Gold’s price extends its struggle with critical short-term 21-day Simple Moving Average (SMA), now at $2,636.

The 14-day Relative Strength Index (RSI) sits listlessly beneath the 50 level, indicating a lack of clear directional bias.  

However, the previous week’s Bear Cross warrants caution for Gold buyers.

Therefore, Fed Chair Jerome Powell’s words are likely critical for the next directional move in Gold price.

Recapturing the 21-day SMA support-turned-resistance at $2,636 is critical for buyers to revive the recovery momentum.

The next relevant resistance aligns at the 50-day SMA at $2,669, above which the $2,700 level will be in sight.

On the downside, Gold sellers need to crack the $2,621 static support to challenge the previous week’s low of $2,605.

A sustained break of that level could expose the 100-day SMA at $2,579.

XAU/USD Current price: $2,647.80

• Geopolitical tensions in South Korea and France undermined the market’s mood.
• The US reported higher-than-anticipated job openings in October, according to the JOLTS report.
• XAU/USD is neutral-to-bearish in the near term, a directional breakout not yet in sight.

The US Dollar (USD) gained upward traction during American trading hours after spending the first half of the day on the back foot amid a better market mood. XAU/USD retreats from an intraday high of $2,655.50 but retains the $2640 mark at the time of writing, as the USD benefits from a deteriorated market mood.

The market sentiment deteriorated following the release of the United States (US) Job Openings and Labor Turnover Survey (JOLTS) Job Openings report, showing the number of openings in the last business day of October stood at 7.74 million, according to the report released by the US Bureau of Labor Statistics (BLS). The reading was higher than the 7.37 million openings in September and beat the market expectation of 7.48 million.

Fresh geopolitical tensions in Asia also undermine the mood. South Korean President Yoon Suk Yeol declared martial law. The army closed the Parliament while representatives voted to block the president’s declaration. The SK Won plunged vs the USD, providing the latter with fresh impetus. News coming from France are no better. The minority government seems to be on the brink of collapse, as opposition lawmakers from the left and the far right vowed to topple Prime Minister Michel Barnier’s Cabinet, according to AP news.

Meanwhile, US indexes trade in the red. Asian and European equities advanced, limiting USD strength, but Wall Street could not follow the lead. Even further, US government bond yields are back on the rise, underpinning the American currency.

Other than that, investors await more US employment-related data scheduled throughout the week. The November ADP report on private job creation is expected to show that 150K new positions were created in the sector on Wednesday. The most relevant figures will be out on Friday when the US will release the Nonfarm Payrolls (NFP) report.

XAU/USD short-term technical outlook

From a technical point of view, the daily chart for XAU/USD shows the pair is pretty much unchanged from its opening and still confined to familiar levels. The Momentum indicator aims higher above its 100 level, but the Relative Strength Index (RSI) indicator heads nowhere at around 48. At the same time, the XAU/USD pair barely holds above a bearish 20 Simple Moving Average (SMA) while the 100 and 200 SMAs keep advancing below the current level, losing their former strength but still aiming north.

In the near term, and according to the 4-hour chart, XAU/USD offers a neutral-to-bearish stance. The pair keeps hovering around a directionless 20 SMA while midway between also flat 100 and 200 SMAs. Finally, technical indicators turned marginally lower right below their midlines, lacking strength enough to confirm another leg lower.

Support levels: 2,626.70 2,611.35 2,598.70  

Resistance levels:  2,655.50 2,671.55 2,688.65

• Silver price climbs to around $30.90 in Tuesday’s early European session, up 1.24% on the day. 
• Silver crosses above the 100-day EMA, but further consolidation cannot be ruled out with the neutral RSI indicator. 
• The first upside barrier is located at $31.68; the initial support level is seen at $30.50.

The Silver price (XAG/USD) gains traction to near $30.90 during the early European session on Tuesday. The white metal edges higher due to the potential stimulus measures from China and ongoing geopolitical uncertainty. 

However, JPMorgan analysts expect a near-term downside for base metals in early 2025 due to potential US tariffs on Chinese goods but see a recovery later in the year, bolstered by stronger Chinese economic stimulus and improved valuations.

According to the daily chart, Silver is set to resume its upside as the price crosses above the key 100-day Exponential Moving Average (EMA). However, further consolidation cannot be ruled out as the 14-day Relative Strength Index (RSI) hovers around the midline, indicating the neutral momentum of the white metal. 

The immediate resistance level for XAG/USD emerges near the upper boundary of the Bollinger Band of $31.68. Any follow-through buying above this level could pave the way to the $32.90-$33.00 zone, representing the psychological level and the high of November 5. The additional upside filter to watch is $34.55, the high of October 29. 

In the bearish event, sustained trading below $30.50, the 100-day EMA, could see a drop to $29.65, the low of November 28. A breach of the mentioned level could expose $27.70, the low of September 9. 

Silver price (XAG/USD) Daily Chart