The employment report for the non-farm sector in the United States for September, published last week, indicates that the labor market remains robust and justifies the need for further interest rate hikes.
Among the positive factors for gold are the ongoing high geopolitical uncertainty, the still-high level of inflation, potential economic growth issues, and expectations of a possible imminent shift in the Federal Reserve's monetary policy direction.
In the short-term perspective, XAU/USD penetrated into the bullish market zone yesterday by breaking through the important short-term resistance level of 1850.00 (200 EMA on the 1-hour chart).
In the event of an escalation in the geopolitical situation worldwide, we may witness further increases in the pair's quotes. In this case, a breakout of today's high at 1865.00 could signal an increase in long positions with growth targets at resistance levels of 1885.00 and 1888.00 (200 EMA on the 4-hour chart). Further growth, with the breakout of key resistance levels at 1904.00 (200 EMA on the daily chart) and 1912.00 (144 EMA on the daily chart), would bring XAU/USD into the medium-term bullish market zone.
In an alternative scenario, a break below the support level at 1850.00 could be the first signal for resuming short positions.
In the event of further declines, the support levels of 1843.00 (the 50% Fibonacci level in the downward correction wave from its peak at 2070.00 to its low at 1615.00), 1823.00 (144 EMA on the weekly chart), and 1800.00 become targets. A break of the key support level at 1774.00 (200 EMA on the weekly chart) would bring XAU/USD into the long-term bearish market zone.
Support levels: 1850.00,1843.00, 1823.00, 1812.00, 1800.00, 1788.00, 1774.00, 1722.00
Resistance levels: 1863.00, 1865.00, 1885.00, 1888.00, 1896.00, 1900.00, 1904.00, 1912.00, 1921.00, 1952.00, 1987.00, 2000.00, 2010.00, 2048.00, 2070.00
