Gold struggles to maintain $3,100 as the equity market sell-off continues

Gold is attempting to reclaim the $3,100 level, currently trading around that mark with price action flattening for the day. The metal avoided a complete breakdown by recovering some of Thursday’s losses, which at one point exceeded 2.50%, closing with a milder decline of -0.65% just above $3,115. However, selling pressure remains as traders assess their next moves and adjust positions.

Attention now turns to Friday’s US economic data, particularly the Nonfarm Payrolls (NFP) report. Estimates for NFP range from 80,000 to 200,000, with a consensus projection of 135,000. Federal Reserve Chairman Jerome Powell is expected to speak shortly after the report, potentially providing reassurance to markets. Investors are increasingly convinced that the Fed could implement four interest rate cuts before the year ends.

Daily Market Movers: US Data to Shape Stagflation vs. Recession Narrative

• Gold is benefiting from heightened macroeconomic, trade, and geopolitical uncertainties, surging nearly 18% this year, according to Bloomberg.
• The CME FedWatch Tool now assigns a 33.2% probability of a rate cut in May, with June still the most likely timing. Market sentiment is increasingly tilting toward three or four rate cuts in total this year.
• Fears of a US stagflation scenario continue to grow, a situation in which gold would likely emerge as a key safe-haven asset, Reuters reports. Meanwhile, the Atlanta Fed GDPNow Index currently sits at -2.84%, reinforcing recession concerns.

Gold Price Technical Analysis: Why $3,100 Remains a Key Level

Gold’s recent rally faced natural profit-taking, but the broader uptrend remains intact. The key driver for the next leg higher is shifting from tariff concerns to fears of recession or stagflation.

• Upside Levels:

  • The daily Pivot Point at $3,112 needs to be reclaimed before attempting another push toward the all-time high at $3,167.

  • R1 resistance at $3,170 further strengthens this zone as a major barrier.

  • R2 resistance at $3,226 is unlikely to be tested on Friday.

• Downside Levels:

  • The first key support is S1 at $3,057, which triggered Thursday’s rebound.

  • S2 support at $2,998 comes into play if gold falls below the critical $3,000 threshold.

Gold traders remain cautious ahead of the NFP report and Powell’s speech, which could dictate the next major move in the market.

XAU/USD: Daily Chart