Gold (XAU/USD) traded around $4,149 per ounce at 9:00 AM on Friday, down 0.67% since the opening of the Asian trading session.
Gold regained some support after US Treasury bond yields retreated from multi-decade highs. However, upside potential remains limited due to concerns over persistent inflation—driven by high energy prices—and the outlook for US interest rates.
The 10-year US bond yield, a key benchmark for global borrowing costs and asset prices, eased to around 5.24% after surging to 5.34% earlier in the session. Meanwhile, the 30-year bond yield remained near a 24-year high before moderating.
US Employment Data in Focus
Geopolitical uncertainty—specifically the stalled US-Iran ceasefire negotiations—continues to support demand for safe-haven assets like gold. At the same time, rising oil prices remain an inflationary risk.
Market attention has now shifted to US employment data for September, due for release on Friday. This data is expected to provide fresh clues regarding the future direction of US interest rates.
Non-Farm Payrolls (NFP) data is projected to show an increase of 90,000 jobs in September, down from 162,000 the previous month. The unemployment rate is expected to remain steady at 4.1%.
Stronger-than-expected employment data could dampen expectations for interest rate cuts and put pressure on gold. Conversely, weaker data could create room for gold to gain support as the US dollar and bond yields decline.
Rising energy prices and any escalation of tensions in the Middle East are also factors that could influence market sentiment toward gold. From a technical perspective, XAU/USD is currently hovering around $4,149 after failing to sustain the recovery seen in the previous session.
The $4,150 level is a key area to watch. If the price manages to hold above this level, gold still has room to retest the $4,200 mark.
Conversely, if selling pressure persists and the $4,150 level is breached, attention could shift to the $4,100 area as the next support level.
For now, gold's direction largely depends on movements in the USD, US bond yields, and employment data, which will serve as key catalysts for the upcoming session.
