Gold price forecast specifically XAU/USD, have reached the upper limit of their weekly trading range, staying just above the $2,350 mark. This follows the release of mixed economic data from the United States. The figures present a complex picture of the US economy, leading to uncertainty among investors as they await the Federal Reserve’s next move in the upcoming June meeting.
Economic Data and Market Impact
In recent data releases, the May ADP report revealed that the private sector added 152K new jobs. This number fell short of expectations, indicating that the labor market may be cooling. On the other hand, the ISM Services PMI showed a positive surprise by increasing to 53.8 in May, up from April’s 49.4, suggesting some resilience in the services sector. These mixed signals have left investors unsure of the Fed’s future monetary policy actions.
The Bank of Canada (BoC) recently made a pre-planned move by reducing its benchmark interest rate by 25 basis points (bps). According to Governor Tiff Macklem, the economy is on a stable path, although a restrictive monetary policy remains necessary. Meanwhile, all eyes are on the European Central Bank (ECB) as it prepares to cut each of its three key rates by 25 bps. This decision has been widely anticipated and factored into the markets. However, investors are still watching closely for any unexpected reactions once the ECB officially announces its decision.
XAU/USD Short-Term Technical Outlook
From a technical standpoint, XAU/USD’s potential for a strong upward movement appears limited. Although longer-term moving averages are trending upwards below the current price level, they do not offer sufficient support for a long-term bullish scenario. The technical indicators have turned higher but remain in neutral territory, which is not enough to confirm a bullish extension.
Looking at the 4-hour chart, XAU/USD maintains a neutral outlook in the short term. The technical indicators show neutral-to-bearish slopes within positive levels, indicating limited buyer interest at current levels. Additionally, the pair is stuck between directionless moving averages, with the 100 SMA at $2,364.10 reinforcing the resistance zone.
Conclusion
The mixed US economic data has added to investor uncertainty, leading to a cautious approach as the Federal Reserve’s June meeting approaches. With XAU/USD trading at the upper end of its weekly range, the gold price forecast remains in a holding pattern, awaiting further clarity on monetary policy from central banks around the world.
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