Gold Daily | Spot Gold Nears Record High as Weak US Labor Market Fuels Rate Cut Expectations

【Latest Gold Price and Recent Trends】

As of now, spot gold has risen by 0.5% to $3,651.92 per ounce, nearing the record high of $3,673.95 hit earlier this week. This week, gold prices have accumulated an increase of about 1.8%, driven by concerns over a weakening US labor market overshadowing inflation worries, with expectations that the Federal Reserve will cut interest rates next week.

【Technical Analysis】

On the daily chart, gold's upward momentum has stalled with the upcoming FOMC decision. Long positions might find better risk-reward near the main trendline at $3,400. Short-term resistance is at $3,675, with next targets at $3,700 and $3,750. On the 4-hour chart, a secondary uptrend line supports the bullish momentum. The 1-hour chart sees resistance at the recent high of $3,657, supported by a short-term trendline.

【Market Sentiment and Economic Background】

US inflation rose in August, with CPI up 0.4% month-over-month, while PPI unexpectedly declined. Initial jobless claims surged to a multi-year high, hinting at labor market weakness. The IMF warns of a 'tug-of-war' in the US economy, with inflation and demand not easing. Market anticipates a 25 bps rate cut by the Fed next week.

【Analyst Opinions】

OANDA analyst Kelvin Wong notes the market is now pricing in at least three rate cuts by 2025, supporting gold in the current environment. Sprott Inc.'s Ryan McIntyre suggests gold might face short-term resistance around $3,900 but remains under-allocated in portfolios long term. Desmond Lachman from AEI points to gold's rise as a warning against US fiscal and policy imbalances.