Gold price traders seem non-committed; looks to US data for some impetus

Gold price (XAU/USD) extends its sideways consolidative price move through the first half of the European session on Tuesday, though it remains close to a nearly two-week high touched the previous day. The US Dollar (USD) regains positive traction and recovers a part of Friday's weaker-than-expected US jobs data-inspired losses, which, in turn, is seen as a key factor acting as a headwind for the commodity. Apart from this, the prevalent risk-on environment contributes to capping the upside for the safe-haven precious metal.

Any meaningful USD appreciation, however, seems elusive in the wake of the growing acceptance that the Federal Reserve (Fed) will resume its rate-cutting cycle in September. The bets were reaffirmed by signs of deteriorating labor market conditions in the US. This, in turn, continues to offer some support to the non-yielding Gold price. Furthermore, persistent trade uncertainties help limit the downside for the commodity, warranting some caution before confirming that the recent recovery from a one-month low has run out of steam.

Daily Digest Market Movers: Gold price bulls remain on the sidelines, not ready to give up yet

• Traders ramped up their bets for rate cuts by the Federal Reserve following the release of the latest US jobs data, which pointed to a sharp deterioration in labor market conditions. According to the CME Group's FedWatch Tool, traders now see over a 90% chance that the Fed will lower borrowing costs in September.
• The US Commerce Department's Census Bureau reported on Monday that Factory Orders plunged 4.8% in June following an upwardly revised 8.3% rise in the previous month. This adds to concerns about the state of the US economy amid US President Donald Trump's erratic trade policies and supports the Gold price.
• Trump signed an executive order last Thursday raising tariffs on dozens of countries, ranging from 10% to 41%, that go into effect on August 7. The Trump administration said that the universal tariff will remain at 10% for countries with which the US has a trade surplus, while nations with which the US has a trade deficit face a 15% floor.
• China and the US – the world's two largest economic giants – are yet to agree on a trade deal. US Treasury Secretary Scott Bessent has said that any extension of the 90-day tariff truce, which is set to expire later this month, would be up to Trump. This keeps investors on edge and could benefit the safe-haven commodity.
• The US Dollar attracts some buyers and, for now, seems to have stalled the post-NFP downfall from an over one-month peak. This is holding back the XAU/USD bulls from placing fresh bets and caps the upside. Traders now look to the US ISM Services PMI for some impetus later during the North American session.

Gold price could aim to reclaim the $3,400 mark and possibly extend the momentum further

From a technical perspective, Friday's breakout through the $3,335 horizontal barrier and a subsequent strength beyond the 100-period Simple Moving Average (SMA) on the 4-hour chart favors the XAU/USD bulls. Moreover, oscillators on daily/4-hour charts have been gaining positive traction and back the case for an extension of a multi-day-old uptrend. Hence, any further slide below the $3,366-3,365 immediate support could be seen as a buying opportunity and remain limited near the $3,350-3,349 region. The latter represents the 200-period SMA on the 4-hour chart and should act as a key pivotal point, which, if broken, could make the Gold price vulnerable to accelerate the fall towards the $3,325-3,322 intermediate support en route to the $3,300 mark.

On the flip side, the overnight swing high, around the $3,385 region, now seems to act as an immediate hurdle ahead of the $3,400 round figure. Some follow-through buying should allow the Gold price to climb further towards the next relevant hurdle around the $3,434-3,435 area. The positive momentum could extend further and eventually lift the XAU/USD towards the all-time peak, around the $3,500 psychological mark touched in April.