XAU/USD. Analysis and Forecast

[Ben Graham]

Gold maintains a cautiously negative tone without developing a clear bearish trend, as market participants refrain from taking aggressive positions ahead of the NFP release—the key U.S. nonfarm employment report. These data will be a decisive factor in assessing the timing of the Federal Reserve's next rate cut, which will directly affect the short-term trajectory of the U.S. dollar and provide fresh impetus for the precious metal. The U.S. dollar continues its two-week rally, setting a new monthly high, which puts pressure on the yellow metal.

Nevertheless, expectations of further interest rate cuts by the U.S. central bank, along with persistent geopolitical uncertainty, are preventing gold from sliding sharply. U.S. Treasury Secretary Scott Bessent said on CNBC on Thursday that rate cuts are the last missing element needed to accelerate economic growth and that the Fed should not delay this step. Meanwhile, the market is pricing in the likelihood that the U.S. central bank will lower borrowing costs in March 2026, with another cut expected by the end of the year. This outlook is supportive of the precious metal.

The geopolitical backdrop also favors gold: the U.S. invasion of Venezuela, the diplomatic conflict between China and Japan, and the prolonged Russia–Ukraine conflict. In an interview with The New York Times on Wednesday, President Donald Trump outlined expectations of long-term U.S. control over Venezuela and the development of its oil reserves. China, escalating tensions with Japan, imposed restrictions on exports of rare earth metals and magnets following remarks by the Japanese prime minister regarding Taiwan.

From a technical perspective, gold has shown resilience below the 9-day EMA. The next support level is seen at $4,400. Resistance lies at $4,500, and a break above this level would open the way toward testing the all-time high. Oscillators on the daily chart remain positive, confirming a bullish outlook.

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