Gold Price Forecast: Key Levels to Watch Amid Symmetrical Triangle Formation

Gold prices currently exhibit a consolidation pattern, which coincides with significant U.S. economic data releases. The market closely monitors key figures such as ADP non-farm employment change, unemployment claims, and PMI readings to gauge the potential impact on the gold market.

Traders are particularly attentive to Friday’s upcoming Non-Farm Employment Change and Average Hourly Earnings data, which could trigger heightened volatility and potentially dictate the short-term trajectory of gold prices.

#GOLD

Gold is currently forming an inside range candle, which typically signals indecision in the market, especially after a period of volatility.

This follows a bearish continuation from yesterday, which reinforced Friday’s dark cloud cover pattern—a bearish reversal signal.… pic.twitter.com/CMzNIaEbpW

— $Trader (@GDXTrader) October 1, 2024

Recent and Upcoming U.S. Economic Events

• ADP Non-Farm Employment Change (Actual: 143K vs. Forecast: 124K): The latest data released on October 3 shows a stronger-than-expected increase in private payrolls, which typically signals a healthier labour market. This has led to mixed reactions in the gold market, as stronger employment data can support a hawkish Federal Reserve stance, weighing on gold.

📅 What’s on this week?

Oct 1: US SM manufacturing PMI
Oct 2: US ADP employment change
Oct 4: US Non-Farm payrolls & unemployment rate
Q3 wraps up: key for market & business reviews! Stay updated on your Equiti Portal 🌐#Equiti #EconomicCalendar pic.twitter.com/l6JUNa8wce

— Equiti (@Equiti_en) September 30, 2024

• Unemployment Claims (Forecast: 222K): Scheduled for release at 12:30 PM today, traders will look for any deviation from the expected figure. Higher-than-expected claims could spark demand for safe-haven assets like gold, while lower claims might reinforce the U.S. dollar’s strength, putting pressure on gold prices.
• ISM Services PMI (Forecast: 51.7): Slated for release at 14:00, the ISM Services PMI will provide insights into the non-manufacturing sector’s health. A reading above expectations would bolster optimism for economic resilience, potentially curbing the appeal of gold.

Technical Analysis: Gold Price Forecast Amid Symmetrical Triangle Pattern

The technical setup for gold shows a symmetrical triangle formation on the 2-hour chart, which typically indicates a period of consolidation before a breakout.

By analyzing the gold chart on the 30-minute timeframe, we can see that today the price faced a correction after reaching the key supply level at $2663 and is currently trading around $2654. Keep in mind that the shadow of war still looms over the market, so it's best to minimize… pic.twitter.com/zWCLxvo5sT

— Arman Shaban (@Arman_Trading) October 2, 2024

The pattern’s upper resistance is observed at $2,663, while immediate support stands firm at $2,644. The formation’s narrowing structure reflects the tug-of-war between bulls and bears as the market anticipates an imminent directional move.

• Key Support and Resistance Levels:
  • Immediate Resistance: $2,663
  • Next Resistance: $2,673 and $2,683
  • Immediate Support: $2,644
  • Next Support: $2,635 and $2,628
• 50 EMA as Crucial Support: The 50-day Exponential Moving Average (EMA), currently hovering around $2,654, is acting as a critical support level. If gold prices remain above this level, it could serve as a springboard for a bullish move targeting higher resistance levels.

Conclusion: What to Expect Ahead

Gold’s symmetrical triangle pattern suggests the possibility of a significant breakout, but the direction remains uncertain.

A breach above $2,663 could propel prices toward $2,673 and $2,683, whereas a downside move below $2,644 may lead to declines targeting $2,635 and $2,628.

Traders should remain vigilant as Friday’s U.S. economic data, particularly Non-Farm Employment Change and the Unemployment Rate, will play a crucial role in setting the tone for gold’s next directional move.

Key Takeaways:

• Gold’s price consolidation reflects market caution ahead of critical U.S. economic data.
• Breakout potential is high, with a symmetrical triangle pattern forming on the 2-hour chart.
• The 50 EMA at $2,654 serves as a pivotal support level for bullish sentiment.

With potential market-moving events just around the corner, traders are advised to closely monitor U.S. economic indicators, as these could provide the necessary momentum for gold prices to break out of their current range.