Over the past 48 hours, gold (XAUUSD) has experienced a sharp decline, closing at $4327.885 per ounce on June 5th, down significantly from the previous day. This drop was largely driven by the release of strong US Non-Farm Payroll (NFP) data, which fueled market expectations for further Federal Reserve interest rate hikes and strengthened the US dollar. A stronger dollar typically pressures gold prices because gold priced in US dollars becomes more expensive for holders of other currencies, thereby reducing demand.

Additionally, despite ongoing geopolitical tensions such as the US-Iran issues that traditionally boost safe-haven assets like gold, elevated oil prices and rising inflation concerns have led markets to anticipate prolonged Fed tightening. This dynamic has dampened gold’s appeal despite its usual role as a hedge. Notably, the gains that gold accumulated earlier this year have almost been wiped out by this recent selloff.

For the average investor, this means gold is currently navigating a highly uncertain environment. On one hand, weaker-than-expected employment data could eventually provide some support. However, as long as the dollar remains strong and rate hike expectations persist, gold prices may struggle to sustain a rally. Investors should closely watch upcoming economic reports and Fed policy signals to adjust their strategies accordingly.

Daily Chart

On the daily chart, XAUUSD shows a descending channel from mid-May highs, with the price recently breaking below medium-term moving averages and approaching the 200-day moving average support. The Bollinger Bands are widening with the price below the middle band, suggesting increased volatility. The MACD indicator remains bearish with signal lines and histogram pointing downward, indicating persistent selling pressure in the medium term.

1H Chart

The hourly chart over the past 3 to 5 days highlights a clear short-term downtrend, with price repeatedly rejected at the 20-period moving average. Bollinger Bands have widened after a squeeze, signaling intensified volatility. A potential MACD bullish crossover is not yet confirmed, so a short-term technical pullback remains possible. Watch for resistance near the short-term moving average within the next 12 hours.

Technical Trend:  Short-term trend is cautiously bearish with medium-to-long-term consolidation, awaiting clear breakout confirmation.

Technically, MACD maintains a bearish outlook, with expanded Bollinger Bands signaling heightened volatility risk. Recent bearish engulfing candlesticks reinforce the sellers’ dominance over the past sessions. Both daily and hourly view suggest more downside risk, although the 200-day moving average stands out as a crucial support zone. Investors should keep a close eye on upcoming US employment figures and the dollar’s movement to avoid sharp adverse swings.

Today’s GMT+1 economic calendar highlights key US data releases at 14:30, including Non-Farm Payrolls, Unemployment Rate, and Average Hourly Earnings. These are expected to directly influence XAUUSD price movements. Stronger-than-expected payrolls would likely boost the US dollar, pressuring gold prices lower, while weaker data could provide a short-term bullish catalyst. Other economic releases from Europe and Japan today are relatively inconsequential for gold.

Resistance & Support

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