On Friday, the gold price pulled back off the session highs of about $2,477 to trade at about $2,427 after the latest US data. The XAU/USD has completed a downward breakout from an ascending channel formation.
The price of the yellow metal has now plummeted to trade slightly above the 100-hour moving average line. As a result, gold is on the verge of entering the oversold levels of the 14-hour RSI.
Gold Price Fundamentals Overview
From a fundamental perspective, the XAU/USD trades during a relatively busy period in the US market. On Friday, the US nonfarm payrolls for July missed the expected job count of 175k with a tally of 114k. The unemployment rate for the month rose to 4.3%, up from 4.1% in June, missing the forecast of 4.1%.
On the other hand, the average hourly wage growth for the month missed the (MoM) forecast of 0.3%, with a growth rate of 0.2%. The (YoY) equivalent also fell short of 3.7% with a change of 3.6%. Elsewhere, factory orders for June missed the expected (MoM) change of -2.9% with a change of -3.3%.
On Thursday, the US ISM Manufacturing PMI for July failed to match the forecast of 48.8 with a reading of 46.8. The ISM Manufacturing Employment Index also missed 49 with 43.4, while the ISM Manufacturing Prices Paid outshone the estimate of 51.8 with a reading of 52.9.
Nonfarm productivity for the period exceeded expectations of 1.7% with a change of 2.3%, while unit labour costs fell short of 1.8% with a change of 0.9%. The initial jobless claims for the week ending July 26 also fell missed 236k with a claim count of 249k.
Gold Price Technical Analysis (the 60-min Chart)
Technically, the XAU/USD has completed a downward breakout from an ascending channel formation in the 60-minute chart. The 14-hour RSI has also pulled back to move closer to the oversold levels of the indicator.
Therefore, the bears will look to extend the current pullbacks toward $2,402 or lower to $2,377. On the other hand, the bulls will look to pounce on rebounds at about $2,451 or higher at $2,477.
Gold Price Technical Analysis (the Daily Chart)
In the daily chart, the price of the yellow metal trades within a gently ascending channel formation. However, the 14-day RSI still seems to have room left to run before reaching overbought conditions.
Therefore, the bulls will look to ride the current rally towards $2,498 or higher to $2,572. On the other hand, the bears will look to pounce on pullbacks at about $2,350 or lower at $2,276.