Gold Price Forecast: XAU/USD to slide towards $1,750 on strong NFP report

Gold slumped to its weakest level in a year at $1,761 on Thursday but recovered above $1,770 early Friday. Will XAU/USD break critical $1,760 support on US NFP? A robust report will weigh on the yellow metal, FXSTreet’s Dhwani Mehta reports.

Strong NFP figures to embolden Fed’s tightening calls despite Omicron woes 

“Friday’s critical US Nonfarm Payrolls data could cement an increased pace of tapering at the December FOMC decision, which may trigger a brief US dollar rally. As a result, gold could breach the key support of around $1,760 to test the next psychological cushion at $1,750.”

“If the market sentiment worsens on intensifying Omicron covid concerns, then the yellow metal could find some support from the risk-off flows-driven renewed weakness in the yields.”

“On the upside, the confluence of the 50, 100 and 200-DMAs at $1,792 needs to be cracked to initiate a meaningful recovery from monthly lows. The next upside target is seen at the $1,800 mark. The further recovery could call for a retest of Wednesday’s high at $1,809, above which the previous month’s high at $1,814 will be put to test.”

“On the downside, a sustained break below the falling trendline support at $1,763, will seek a test of the November 3 low of $1,759. Further south, the $1,750 psychological level will challenge the bullish commitments.”