Gold Price Forecast: XAU/USD focuses on US Nonfarm Payrolls and weekly close

Gold price is consolidating weekly losses while hanging close to monthly lows of $3,268 early Friday, awaiting a flurry of high-impact US data flow, including the Nonfarm Payrolls (NFP).  

Will Gold price see a big sell-off on US Nonfarm Payrolls data?

Markets remain risk-averse heading into the weekend, taking account of the fresh tariffs hit by US President Donald Trump on the August 1 deadline day this Friday.

Late Thursday, Trump announced minimum global tariff rates at 10%, while increasing levies on Canadian goods to 35% from 25% for all products not covered by the U.S.-Mexico-Canada trade agreement.

The president slapped a 39% tariff rate on imports from Switzerland. However, he gave Mexico a 90-day reprieve from higher tariffs to negotiate a broader trade deal.

The round of fresh tariff announcements sag investors’ confidence once again, as they flock to safety once again in the US Dollar (USD).

Fresh tariff concerns combined with the hawkish hold decision by the US Federal Reserve (Fed) earlier this week continue to power the USD rally against its major currency rivals, keeping Gold price languishing in monthly troughs.

Attention now turns to the all-important US labor market report, with NFP data closely monitored for fresh hints on the timing of the next interest rate cut this year.

Markets are pricing in less than a 50% chance that the Fed will lower rates in September, according to the CME Group’s FedWatch Tool.

Meanwhile, the US economy is expected to add 110,000 jobs in July after reporting a decent 147,000 growth in June. The Unemployment Rate is seen ticking a tad higher to 4.2% in July from 4.1% prior.

A print below the 100,000 level and a rise in the Unemployment Rate could signal signs of a weakening labor market, pushing back against the renewed hawkish Fed expectations and weighing on the Greenback. In such a scenario, Gold price could see a fresh recovery toward $3,400.

However, a headline NFP surprise above 150,000 could bolster the ongoing USD advance at the expense of the bright metal. Strong US jobs data will likely rule out bets for two Fed rate cuts this year.

Gold traders will pay close attention to the developments on the trade front and speeches from Fed policymakers, as they return from the ‘blackout period.’

Gold price technical analysis: Daily chart

With the Bear Cross still in play and the 14-day Relative Strength Index (RSI) lurking below the midline, downside bias remains intact for Gold price.

The 21-day Simple Moving Average (SMA) pierced through the 50-day SMA from above on a daily closing basis on Wednesday, validating a Bear Cross.

Therefore, a weekly closing below the critical support of the 100-day SMA at $3,270 is waited for a fresh downtrend toward the June 30 low of $3,248.

The line in the sand for Gold buyers is at the May 20 low of $3,205.

Conversely, any recovery attempts will need acceptance above the 21-day SMA and 50-day SMA supply zone near $3,340.

Ahead of that, the $3,300 psychological level must be scaled.

If the rebound sustains, the next topside hurdle is seen at the $3,380 static resistance.