Gold Remains in a Consolidation Phase!
Gold prices moved cautiously in trading on Friday (November 7th), as global investors awaited the release of US employment data and the Federal Reserve's policy direction. Although initially pressured by a strengthening US dollar, the precious metal showed signs of stabilization towards the end of the week, maintaining its position around US$3,990 per troy ounce.
From a fundamental perspective, gold's movement this week reflects a tug-of-war between two major forces: a strengthening dollar, which pressures prices, and expectations of interest rate easing, which support the precious metal. A Reuters report stated that a stronger dollar kept gold "stuck below the psychological level of US$4,000," while the market still awaits clearer signals on whether the Fed will begin cutting interest rates in December.
However, medium-term support for gold remains strong. Data from the World Gold Council shows significant purchases from several central banks, particularly from Asia and the Middle East, seeking to bolster non-dollar foreign exchange reserves. Meanwhile, physical demand from China and India has also increased, in line with the wedding season and year-end celebrations that typically drive gold jewelry consumption.
Technically, analysts assess that gold prices are currently moving in a consolidation phase. The nearest support is at US$3,950–4,000, while strong resistance is at US$4,000–4,050 per troy ounce. If gold can break through this area, the potential for strengthening to US$4,100 is wide open. However, if the dollar continues to strengthen and US employment data is better than expected, selling pressure could drag prices back below US$3,900.
As the week closes, analysts predict gold prices will be in the range of US$3,940–4,050 per troy ounce. Market sentiment is expected to remain cautious, with volatility increasing ahead of the release of important US economic data.
"As long as global monetary policy uncertainty remains high and central bank demand continues to increase, the medium-term trend for gold remains positive, although the short-term is still vulnerable to correction," said analysts from FXEmpire in their report.
Source: Newsmaker.id
