Gold prices dipped a bit during Friday’s Asian session. It’s having a hard time building on yesterday’s bounce from around $4,400. The reason? The US dollar looks strong—it’s hanging out near a one-month high, and a stronger dollar usually drags gold down, since gold doesn’t pay interest. Still, gold isn’t seeing a big wave of sellers. Most traders are holding back, waiting for the US Nonfarm Payrolls report, which always shakes things up.
Traders Weigh Fed Moves and Data Uncertainty
Traders are staying cautious and everyone’s watching the Federal Reserve and wondering when they’ll start cutting rates. There’s growing talk of a rate cut as early as March, with another possible later this year. That kind of thinking stops the dollar from running even higher and gives gold a bit of a safety net. But the jobs data coming up will really set the tone for both the dollar and gold. Until then, expect gold to stay stuck in a pretty tight range.
Geopolitics and Chart Signals Give Gold Some Support
Gold isn’t just moving on interest rates and the dollar. Geopolitical jitters are also supporting it. But ongoing fears about Ukraine, tension between China and Japan, and unrest in Venezuela continue to make investors nervous. Lastly, gold remains above its ascending 200-period EMA on the charts, so the overall bullish case is still intact there. Momentum signals indicate that selling is slowing down, and gold is likely to stabilise or even recover if it can hold above important support. If it climbs above $4,500, expect buyers to get interested again. On the other hand, unless it crashes through major support, don’t look for any dramatic drop.
