Current trend

The XAU/USD pair is practically unchanged, consolidating near 2735.00. Market activity remains muted as traders are reluctant to open new trading positions ahead of the US presidential election results today. Despite numerous forecasts and public opinion polls, uncertainty about who will occupy the post of head of the White House remains very high. At the same time, the positions of the American currency are supported by the confidence of some analysts in the victory of the Republican candidate Donald Trump, under whom the US Federal Reserve is expected to continue to reduce the cost of borrowing, since he, among other things, promises to sharply tighten tariff policy. In particular, it was previously stated that Trump was ready to introduce a 60.0% duty on all Chinese goods imported into the United States.

Meanwhile, markets are also assessing the October labor market data released at the end of last week: the US economy created a record low number of new jobs outside the farm sector — only 12.0 thousand, while analysts expected 113.0 thousand, and in the previous month the increase was 223.0 thousand. In turn, Average Hourly Earnings accelerated from 0.3% to 0.4% month-on-month and from 3.9% to 4.0% year-on-year, while the Unemployment Rate remained at 4.1%. Immediately after the report was published, the US dollar weakened noticeably, but then the situation stabilized somewhat, as experts attributed the low results to two hurricanes, Milton and Helen, which hit the country in October, as well as protests at The Boeing Co.

Meanwhile, the gold contract market continues its period of global growth. According to the report of the US Commodity Futures Trading Commission (CFTC), last week the number of net speculative positions in precious metal decreased to 278.7 thousand from 296.2 thousand a week earlier. Investors are approaching holding buy positions with caution, expecting increased volatility in the market: thus, the balance in positions secured by real money amounted to 257.521 thousand for the "bulls" versus 20.446 thousand for the "bears". Last week, buyers liquidated 0.438 thousand contracts, while sellers increased their number by 4.577 thousand, which indicates a slight correction in the asset. Additional support for gold comes from expectations of further monetary easing by the US Federal Reserve and the Bank of England, whose meetings are scheduled for Thursday, November 7, with analysts currently confident of a 25-basis-point cut in interest rates in both cases.

Support and resistance

In the daily chart, Bollinger Bands are reversing horizontally. The price range is narrowing, reflecting the emergence of ambiguous dynamics of trading in the short term. MACD is going down preserving a stable sell signal (located below the signal line). Stochastic shows similar dynamics, but is currently located near its lows, indicating the risks of gold being oversold in the ultra-short term.

Resistance levels: 2740.53, 2760.00, 2775.00, 2790.00.

Support levels: 2720.00, 2700.00, 2685.56, 2670.00.

Trading tips

Long positions can be opened after a breakout of 2740.53 with the target of 2775.00. Stop-loss — 2720.00. Implementation time: 1-2 days.

The return of "bearish" trend with the breakdown of 2720.00 may become a signal for new sales with the target at 2685.56. Stop-loss — 2740.53.