Gold Price Continues to Consolidate in a $50 Range

The price of Gold dived below $2,300 after the NFP on Friday, reaching the lowest point in a month, but again it climbed back above it fast.

Skerdian Meta•Monday, May 6, 2024•1 min read

The price of Gold dived below $2,300 again after the NFP on Friday, reaching the lowest point in a month, but again it climbed back above it pretty fast. Today it has been making some decent gains, but they are getting smaller as we approach the top of the range, which is an indication that Gold will continue to trade in the range as uncertainty prevails at the moment.

During most of the day, the price of gold (XAU/USD) has been making gains, ending a two-day decline. Weaker-than-anticipated US employment figures for April which were released last week, increased the likelihood of a rate cut by the US Federal Reserve (Fed) in Q3. Consequently, this pushed the US Dollar (USD) lower and lifted XAU/USD, which is denominated in USD. It’s important to highlight that lower interest rates can diminish the opportunity cost of investing in Gold, thus boosting demand and Gold prices.

Gold Chart H4 – The Price Remains Confined Between MAs

After the sharp decline in the USD on post NFP (Non-Farm Payrolls), at first Gold saw a strong surge, reaching $2,321. However, XAU encountered resistance around the 50-hour moving average (yellow line) and reversed back, falling to a new low at to $2,277. Over the past week, the price has been hovering around the $2,30o zone, which continues to do today.

Currently, Gold is up by 0.8% to $2,325, but it continues to face resistance from the 100-hour moving average (green), is at the moment is positioned at $2,340. Sellers have been active near this crucial near-term level, preventing further upward movement for the time being, so we will be following the price action there and might issue a sell Gold signal.

Gold Live Chart

GOLD

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Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.