Gold Price Forecast: XAU/USD grinds higher following US NFP report, steady around $1816

• The non-yielding metal advances half percent in the North American session.
• The rise of US T-bond yields capped upward moves in the yellow metal but failed to push prices lower.
• XAU/USD is neutral-upward biased as depicted by DMAs below the spot price.

Gold (XAU/USD) climbs in the North American session, despite US T-bond yields shooting through the roof after the US Nonfarm Payrolls report smashed expectations. At the time of writing, XAU/USD is trading at $1,816.

Financial markets mood is upbeat. As of late, US Treasury yields move higher in the session, with the 10-year benchmark note rate at 1.936%, underpins the greenback, with the DXY flat at 95.50.

On Friday of the last week, the US Nonfarm Payrolls report showed that the US economy added 467K jobs to the economy, smashing 150K estimations. At the same time, the Unemployment Rate rose to 4%, a tick higher than foreseen. However, Fed concerns about inflation made investors turn their attention to Average Hourly Earnings, which rose more than half-percent, from 5% in December to 5.7% in January, further cementing Fed’s hawkish expectations, as money market futures have priced in at least five rate increases.

That said, the non-yielding metal stayed resilient, despite the outstanding US employment report. Following the announcement, XAU/USD found bids around $1790, followed by a break of the $1800 figure, finishing above it in the last week. 

Analysts at TD Securities noted that “… tracking ETF flows suggests little such interest in the yellow metal.” However, they said that “it remains to be seen whether central bank purchases might be playing a substantial role in keeping gold prices from breaking lower, as the data continues to point to little speculative interest for the yellow metal.”

That said, gold traders, attention turns to Thursday US inflation figures, which would give some clues regarding US Treasury yields direction, which significantly influences gold prices.

XAU/USD Price Forecast: Technical outlook

At press time, gold is trading above the 200-day moving average (DMA), which sits at $1,806, suggesting an upward bias. Nevertheless, as most of the daily moving averages (DMAs) reside in the $1,796-$1,806 range, almost horizontal, the yellow metal is neutral. 

Upwards, XAU/USD’s first resistance would be the central line of  Pitchfork’s channel around  $1,825-27. Breach of the latter would expose July 15, 2021, a daily high at $1,834, followed by the mid-line between the top/central Pitchfork’s channel around $1,840-50.

On the other hand, gold’s first support would be $1,800. A downward break would open the door for a fall to the 100-DMA at $1,796, followed by the bottom-trendline of Pitchfork’s channel at $1,790, and January 28 daily low at $1,780.