FX.co ★ XAU/USD, GOLD

Fundamental Analysis of Gold (XAU/USD) Gold closed the week at $4,070 per ounce after a late reversal. For most of the week, the metal was recovering , and it climbed to a two-week high of $4,146 on Thursday before falling about 1.2% on Friday. The trigger was jobs data , as October nonfarm payrolls came in at 165K against a forecast of 65K, which strengthened the case for a Fed rate hike in December. Because bullion pays no yield, a resilient labor market and higher rates reduce its appeal. The central bank's own signals support that view: the Fed left rates unchanged in October, but Lisa Cook and Beth Hammack voted for a quarter-point increase. Economic data are also firm, since September PCE inflation reached 3.6% year on year, core PCE stayed at 3.1%, and the economy grew at a 3.4% annualized pace in the third quarter. Some relief came from energy , as lower oil prices supported gold's weekly recovery, but that was not enough to offset the rate story. Fed Chair Warsh has so far avoided committing to a particular path, though a clear commitment to fight inflation may be enough to keep December hike expectations alive. The week ahead is important, because US inflation figures, jobless claims and a stream of Fed speakers are due. Traders should also watch Treasury yields, the dollar and oil headlines over the weekend for any gap at Monday's open. 1-Hour Chart Analysis The 1-hour chart shows gold finishing at $4,070, right on top of a pivotal support level, after an abrupt slide from the $4,146 high. Price closed beneath both moving averages; the 5 EMA has dropped below the 20 EMA, and the 20 EMA, sloping down near $4,090, is acting as a ceiling for every small bounce. That is a clear bearish structure for the start of next week, although the heavy drop means the market may be oversold in the very short term. The first resistance is $4,090 to $4,108, the area that held as a barrier in recent sessions, followed by $4,146. An hourly close above $4,108, with the 5 EMA crossing back above the 20 EMA, would suggest that the sell-off was exaggerated and open the way toward $4,146 again. On the downside, $4,070 is the key support area that has contained downside attempts since late September. An hourly close below $4,050 would put $4,000 in play, and a break of that round number would expose the $3,975 low. For Monday, avoid acting on the opening gap alone; wait for a candle to close beyond a level. A tactical idea is to sell a rejection at the 20 EMA with a stop above $4,110, targeting $4,030, or to buy only after a firm reclaim of $4,108.

4-Hour Chart Analysis The 4-hour chart shows a more mixed picture, with gold slipping below the short-term averages while still holding above the longer ones. XAU/USD remains above the 50-period and 100-period SMAs on the 4-hour chart , which gives bulls a reason to defend the area. Price has fallen beneath the 20 EMA near $4,105, and the 5 EMA is turning down through it, a warning that momentum has shifted to sellers after the Thursday peak. The $4,070 zone is the swing point: it was a floor, then turned into a ceiling when the recovery from the $3,975 lows stalled at support-turned-resistance around $4,070, and now gold is testing it from above again. A 4-hour close beneath $4,050 would confirm a breakdown and expose $4,000, then $3,975 and the wider $3,940 area. For the bulls, the barrier chain is $4,108, $4,146, and the $4,200 round figure, and only a close above $4,200 would shift focus toward $4,255. Swing traders may prefer to wait for either a decisive 4-hour close below $4,050 for a short, or a bullish engulfing candle at $4,070 together with a 5 EMA turn-up for a long, with a stop under $4,030. With US CPI coming, keep position sizes modest, since hot inflation could strengthen the dollar and push gold toward the lower supports quickly .