Gold Price Forecast: XAU/USD looks to challenge key $1,932 resistance ahead of Jackson Hole

Gold price is extending the recovery from five-month lows into the fourth day in a row this Thursday, flirting with two-week highs near $1,920. The United States Dollar (USD) is licking its wounds alongside the US Treasury bond yields, providing a fresh lift to the Gold price, as traders position for a fresh batch of top-tier US economic data and the US Federal Reserve’s (Fed) three-day annual Economic Symposium at Jackson Hole, Wyoming.

Eyes on fresh United States data and Jackson Hole Symposium

Gold price is building on this week’s bullish momentum, helped by a sharp pullback in the US Dollar, as well as, the US Treasury bond yields after the S&P Global Manufacturing and Services PMI data from the United States disappointed markets and bolstered expectations that the Federal Reserve may refrain from any further rate hikes this year.

S&P Global said its preliminary US Composite PMI index, which tracks manufacturing and service sectors, dropped to 50.4 in August from 52 in July, registering the biggest drop since November 2022 while indicating that the US business activity is nearing stagnation.

According to CME Group’s FedWatch Tool, markets have almost priced in a pause from the Fed next month. They see a 57.7% probability that the Fed would hold steady in November, up from 54% previously. They are also back to pricing in rate cuts of 102 basis points next year.

Meanwhile, a risk rally on Wall Street also exacerbated the pain in the safe-haven US Dollar, as investors remained expectant of upbeat earnings release from artificial intelligence (AI) chip maker Nvidia. Post the closing bell, the outstanding results sent Nvidia shares soaring 10%. “The leading semiconductor designer reported adjusted earnings per share (EPS) of $2.70 – 29% higher than Wall Street expected. Likewise, revenue of $13.51 billion was 22% ahead of consensus,” Clay Webster, FXStreet’s Analyst noted.

Next of note for the Gold price remains a fresh batch of US economic data, including the Durable Goods Orders, weekly Jobless Claims and regional business activity data for fresh hints on the strength of the US economy as well as on the Fed’s policy path. Gold price could see some profit-taking, as investor reposition heading into the highly-anticipated Jackson Hole Symposium, starting this Thursday. Fed Chair Jerome Powell is due to speak at the economic conference on Friday.

Gold price technical analysis: Daily chart

Having charted an upside break from the descending trendline resistance on the daily sticks earlier this week, Gold price extended its uptrend and recaptured the critical upward-sloping 200-Daily Moving Average (DMA), now at $1,909, on a daily closing basis on Wednesday.

The 14-day Relative Strength Index (RSI) is inching higher, looking to piece through the 50 level for the upside. The technical indicator suggests that the tide could be turning in favor of Gold buyers.

If that happens, Gold price could attempt a firm break above the bearish 21 DMA at $1,921, above which a fresh run toward the 50 DMA resistance at $1,932 could be in the offing.

On the downside, the immediate support is seen at 200 DMA resistance-turned-support at $1,909. Failure to defend the latter will challenge the previous day’s low of $1,897.

Further down, the abovementioned descending trendline resistance now support at $1,883 will test bullish commitments.