Gold Price Forecast: XAU/USD faces hurdles in the $1,800 area, DXY below 106.00 ahead of US NFP

• Gold price is focused to recapture the psychological resistance of $1,800.00.
• Cleveland Fed President Loretta J. Mester sees interest rates above 4%.
• The downbeat consensus for the US NFP will keep gold bulls solid ahead.

Gold price (XAU/USD) has sensed minor selling pressure after hitting a high of $1,794.91. The precious metal is directed to recapture the psychological resistance of $1.800.00 as the US dollar index (DXY) is facing severe heat despite hawkish commentary from Federal Reserve (Fed) policymakers. Also, the lower consensus for the US Nonfarm Payrolls (NFP) is keeping the DXY on the back foot.

Cleveland Fed President Loretta J. Mester cited on Thursday that the policy tightening measures should not be halted by the Fed without recording downward signs in the price pressures for months. The Fed should raise interest rates to above 4% in order to bring inflation back down to the 2% target. Therefore, the interest should see the continuation of elevation this year and for the next half year. Despite, the hawkish commentary, the DXY bulls failed to capitalize on the same.

On the economic data front, the US NFP will remain the show-stopper event for today. As per the market estimates, the US economy has failed to outperform June’s job additions numbers and has added 250k jobs in the labor market in July. Also, the Unemployment Rate is seen flat at 3.6%. The commentary from big US corporate players indicated that the firms have halted their recruitment process for the remaining year, whose consequences will be displayed in the labor market data. This will keep the gold bulls in the driving seat.

Gold technical analysis

On a four-hour scale, the gold price is facing resistance around the upper portion of the Rising Channel formation. The upper portion of the above-mentioned chart pattern is plotted from July 22 high at $1,739.37 while the lower portion is placed from July 21 low at $1,681.87.

The precious metal is confidently established above the 50-and 200-period Exponential Moving Averages (EMAs) at $1,759.62 and $1,765.06 respectively, which adds to the upside filters.

Also, the Relative Strength Index (RSI) (14) has shifted into the bullish range of 60.00-80.00, which indicates more gains ahead.

Gold four-hour chart