Gold Price Forecast: XAU/USD run-up approaches $2,000 as United States Nonfarm Payrolls loom

• Gold Price eyes first weekly gain in four amid downbeat United States Treasury bond yields, US Dollar.
• Market’s cautious optimism about US debt ceiling deal’s passage through Congress, easing hawkish Federal Reserve bets favor XAU/USD bulls.
• US Nonfarm Payrolls (NFP), Unemployment Rate need to portray tight job markets to prod the Gold Price.

Gold Price (XAU/USD) remains on the front foot at the weekly high, making rounds to $1,975-77 amid early Asian session on Friday following the two-day uptrend. With this, the yellow metal braces for the first weekly gains in four amid broad weakness in the United States Treasury bond yields and US Dollar. While trading the main catalysts, the market’s expectations of witnessing the Federal Reserve’s (Fed) rate hike pause in June gain major attention. Adding strength to the XAU/USD upside is the passage of the US debt-ceiling deal through the House of Representatives and the mixed US data. Furthermore, upbeat China PMI also favored the Gold buyers.

Moving on, the Gold traders should wait for the United States monthly employment report for fresh clues.

Gold Price rises amid downbeat Federal Reserve bets

Gold Price grinds higher around the weekly top as the market’s pricing of the Federal Reserve (Fed) rate hike drops, from a 17 basis points (bps) in June on Wednesday to 7 bps on Thursday. Behind the latest move could be the mixed United States data and a lack of strong hawkish comments from the Fed Officials.

On Thursday, US ADP Employment Change eased to 278K in May from 291K prior (revised) but crossed the 170K market forecasts. On the same line, the weekly Initial Jobless Claims rose past 230K prior to 232K, versus 235K expected. Further, US ISM Manufacturing PMI eased to 46.9 in May compared to 47.0 anticipated and 47.1 previous readings whereas S&P Global Manufacturing PMI softened to 48.4 from 48.5 prior. Additionally, the US Employment Cost Index eased while consumer sentiment gauge improved but the details were unimpressive.

Elsewhere, Federal Reserve Bank of St. Louis President James Bullard recently published an analysis wherein the Fed hawk accepts that the prospects for continued disinflation are good but not guaranteed, and continued vigilance is required.

Passage of US debt-ceiling deal, China data also favor XAU/USD bulls

The US Republican-controlled House of Representatives recently passed the debt-ceiling bill and favored the market’s optimism as the ruling Democrats dominate in the Senate and can easily avoid the default now.

It’s worth noting that the upbeat China Caixin Manufacturing PMI adds strength to the XAU/USD’s upside momentum.

All eyes on the United States Nonfarm Payrolls

Looking forward, the US employment clues and the last round of the Fed talks ahead of the pre-FOMC blackout period for policymakers.

Also read: US May Nonfarm Payrolls Preview: Analyzing Gold price's reaction to NFP surprises

Gold Price technical analysis

Gold price extends recovery from the 100-DMA and a seven-month-old ascending support line, around $1,940 by the press time, to approach the 50-DMA hurdle surrounding $1,992.

Not only the U-turn from the key support line and DMA but a clear upside break of the previously important resistance line stretched from early May also keeps the XAU/USD buyers hopeful.

On the same line, the upbeat Relative Strength Index (RSI) line, placed at 14, as well as the receding bearish bias of the Moving Average Convergence and Divergence (MACD) indicator, add strength to the upside expectations of the Gold price.

That said, the 50-DMA breakout needs validation from the $2,000 round figure before approaching multiple resistances near $2,050.

Meanwhile, a convergence of the 100-DMA, the resistance-turned-support line and a multi-day-old rising trend line, near $1,938-40, appears an important challenge for the XAU/USD bears to conquer to regain control.

Following that, the Gold price south-run toward the peaks marked in early February and March, around $1,890 and $1,858 can’t be ruled out.

To sum up, the Gold Price appears well-set to recapture the $2,000 round figure.

Gold price: Four-hour chart

Trend: Limited upside expected