Gold Near Multi-Month High as Traders Eye US Jobs Data

Key Moments

Gold Regains Ground as Safe-Haven Flows and Rate Bets Collide

Gold (XAU/USD) extends its intraday advance heading into the European session on Friday, reversing part of the prior day’s pullback and moving back toward the $4,300 region. That level sits close to the peak reached on Thursday, which was the highest since June 18. The metal remains positioned to log its strongest weekly gain since January as traders await the latest US monthly labor market report for fresh direction amid conflicting developments around the US-Iran peace process.

Market sentiment is being shaped by a combination of geopolitical headlines and shifting rate expectations. While demand for safety is underpinning the US Dollar, the resulting strength in the greenback is simultaneously restraining additional upside in Gold.

US-Iran Tensions and Regional Risk Support Safe-Haven Demand

On the geopolitical front, signals remain mixed. US President Donald Trump told reporters on Thursday that he believed “the war with Iran would be over soon.” In contrast, a Saudi official warned that certain Iraqi militia groups, working with Yemen’s Iran-backed Houthis, are planning to strike the kingdom “in the very near future.” This divergence heightens fears of a broader regional escalation and encourages markets to price in a geopolitical risk premium.

That risk premium is lending support to safe-haven assets, including the US Dollar, and is seen as a factor restraining Gold’s ability to extend gains more aggressively. The stronger USD makes the metal relatively more expensive for holders of other currencies, limiting follow-through buying despite the supportive risk backdrop.

Additional pressure on risk sentiment comes from reports that Iran is reviewing a framework governing the Strait of Hormuz that would bar passage of US, Israeli, and other hostile ships until compensation is paid. Such a step would reduce hopes for a diplomatic solution to the five-month-old US-Iran conflict. At the same time, Houthis have claimed responsibility for an attack on a Saudi oil tanker in the Gulf of Aden, raising fresh worries over energy supply disruptions, providing a tailwind for oil prices, and adding to inflation concerns.

Fed Hike Probabilities and Policy Outlook Weigh on Bullion

Rising inflation risks increase the possibility that global central banks, including the Federal Reserve, may lean more hawkish. A firmer policy stance would be a headwind for Gold, as higher interest rates raise the opportunity cost of holding non-yielding assets.

According to CME Group’s FedWatch Tool, market participants are still assigning more than an 80% probability that the Fed will raise borrowing costs by the end of this year. This backdrop supports USD bulls and argues for caution before assuming that XAU/USD will continue its recovery from the $4,000 psychological level without interruption.

Against this policy backdrop, traders appear reluctant to initiate sizable new positions before the release of the closely monitored US Nonfarm Payrolls (NFP) report. The labor data are expected to influence expectations for the Fed’s next steps and, by extension, near-term demand for the US Dollar and Gold. The result could provide the next major catalyst for a directional move in the metal.

OCBC Views: Momentum Improves but Sustainability Hinges on US Data

Analysts at OCBC emphasize that “near-term momentum has improved,” noting that the upcoming US payrolls report is “key to whether the decline in yields, USD and gold’s breakout can be sustained.” They observe that gold was “last seen at $4,247 levels,” adding that “daily momentum is mildly bullish while RSI rose to near overbought conditions.”

From a technical perspective, OCBC flags “resistance at $4,333 (23.6% fibo retracement of 2026 high to low), $4,393 (100 DMA)” and “support at $4,160 (50 DMA), $4,077 (21 DMA),” indicating a generally constructive stance while acknowledging that the durability of the recent move will depend heavily on the tone of incoming US data.

Technical Outlook: Bulls Target a Break Above 38.2% Fibonacci Level

This week’s move above the $4,165 confluence area – which combined the 23.6% Fibonacci retracement of the April-June decline with the 50-day Simple Moving Average (SMA) – has been an important confirmation for bullish participants. Momentum studies are aligned with this positive bias: the Relative Strength Index (RSI) stands at 61.29, while the Moving Average Convergence Divergence (MACD) remains above the zero line with a positive latest reading. Together, these indicators suggest that buyers retain control as the advance tests emerging resistance.

The next significant obstacle is the 38.2% Fibonacci retracement near $4,300, which currently caps further gains. Above that, the 50% retracement at $4,414 and the 61.8% retracement at $4,525 form a broader resistance band before higher ceilings appear at $4,683 and $4,884.

On the downside, initial support is identified around $4,265. Below that, stronger buying interest is anticipated around the 23.6% retracement at $4,165 and the 50-day SMA at $4,151. A more pronounced correction toward the structural support zone near $3,943 would be required to materially challenge the prevailing bullish narrative.