Gold still in search of a solid break higher since the start of the week
The issue for gold buyers is that they may very well end up being caught between two minds as we look to close out the week.
A more negative tone to US-China trade talks yesterday helped solidify gains above $1,500 again but with the Fed hinting at a pause in the rate cut cycle, the short-term outlook may be a bit tricky as that sentiment may carry on for a while.
However, in the longer-term, I don't think the gold trade is anywhere close to being dead/over just yet. Barring a miraculous recovery in the global economy, the Fed is going to look towards more rate cuts over the next 1-2 years and so will other major central banks.
Put that together with struggling economies around the globe and the persistent fear of that weighing on equities eventually, gold will continue to find more structured bids in the big picture in my view.
But for now, the more immediate sentiment is at play and that is we're all waiting on the US jobs report to confirm the events since Wednesday.
A more dismal report later will no doubt see gold benefit as rate cut fears will come back to the table quicker than many would expect. But the opposite could also play out, so just be mindful of that ahead of the release.
From a technical perspective, the same levels at the start of the week continue to define gold with resistance around $1,512 to $1,519 an area buyers must break above considering the lack of push from fundamentals.
As for any downside move, watch towards the $1,495 to $1,497 levels as that is where the key hourly moving averages lie. If sellers breach below that, the near-term bias turns more bearish again with further support seen closer towards $1,480.
