Article by: ETO Markets

Gold prices (XAU/USD) eased in early Asian trade on Friday, mainly on the back of strong US economic growth and jobless claims data, which pushed back market expectations of a September Fed rate cut, putting some pressure on gold prices. However, with heightened geopolitical tensions, particularly in the Middle East and the Russia-Ukraine conflict, safe-haven demand could still provide support for gold.

Investors' attention will be focused on the upcoming release of the U.S. core personal consumption expenditures (PCE) price index, the Fed's preferred tool for gauging inflation. If the PCE data is lower than expected, it may strengthen the market's confidence in the Fed to start the rate cut cycle, which will be positive for gold prices.

From a technical point of view, although gold prices fell slightly during the day, the overall trend remains bullish. Gold is currently fluctuating within a five-month uptrend channel and has not broken through the resistance levels of the upper channel boundary and all-time highs, indicating that there is some upside in the short term. The key resistance is near $… at the intersection of the all-time high and the upper boundary of the trend channel, a break above which could see further gains to the psychological level of $…. On the downside, if gold breaks below the initial support level of $…, it could test further to $… (August 15 low) or even $… (100-day EMA).