Gold trading reminder: The market has pessimistic expectations for non-farm payrolls, and most analysts are bullish on gold prices in the future.

In early trading in the Asian market on Monday (April 29), spot gold fluctuated within a narrow range and was currently trading at $2,336.04 per ounce. The rebound in gold prices was blocked last Friday, closing at $2,337.36 per ounce, after data showed that U.S. prices rose in line with expectations; as the Middle East crisis avoided a major escalation, some geopolitical risk premiums fell, and gold prices still fell more than 2% on a weekly basis, hitting a record high in December Worst weekly performance since.

The U.S. personal consumption expenditures (PCE) price index rose 0.3% month-on-month in March, in line with expectations, which is unlikely to change expectations that the Federal Reserve will not cut interest rates until September.

U.S. Treasury yields fell after the data, making gold more attractive. But the U.S. dollar index rose nearly 0.5%, recouping all losses from earlier last week.

Robert Minter, director of investment strategy at Abrdn, said he expects gold prices to continue to be well supported as institutions become increasingly concerned about the U.S. government's ballooning debt. In this environment, central banks will continue to limit exposure to the dollar and U.S. debt, he added.

He said: "At some point, the bond market vigilantes are going to come back because government spending is out of control. Interest payments on the U.S. government debt exceed U.S. defense spending. There is an alternative to holding U.S. Treasuries, and that Just hold gold. Generalist investors haven’t seen that yet, but they will at some point. $2,400 is definitely not a high water level for gold.”

Independent metals trader Tai Wong said data continued to suggest "stubborn inflation may persist, but gold's reaction suggests the market has already priced this in".

Gold's direction "depends on overall risk asset sentiment and buying from the Far East." Wong believes that gold will consolidate between $2,300 and $2,400 in the short term.

The market initially expected the first U.S. interest rate cut to be in March, but as the U.S. successively released strong economic data, expectations were first postponed to June and now to September.

According to CME FedWatch, the probability of the Fed cutting interest rates by 25 basis points in May is 2.5%; the probability of the Fed keeping interest rates unchanged until June is 88.2%, and the probability of cumulative interest rate cuts of 25 basis points and 50 basis points are 11.5% and 0.2% respectively; The probability that the Federal Reserve will keep interest rates unchanged until July is 74.6%, and the probability of cumulative interest rate cuts of 25 basis points and 50 basis points are 23.4% and 2% respectively; the probability of the Federal Reserve keeping interest rates unchanged by September is 41.8%, and the cumulative probability of cutting interest rates is 25 basis points. The probabilities of 1 basis point, 50 basis points and 75 basis points are 45.9%, 11.4% and 0.9% respectively.

The China Gold Association said gold consumption in China climbed nearly 6% in the first quarter compared with the same period last year.

Phillip Streible, head of market strategy at Blue Line Futures, said he remains bullish on gold as the U.S. economy appears to be entering a period of stagflation. However, he added that investors will have to pay close attention to next week's data, including government employment data for April.

Streible added that a disappointing non-farm payrolls report showing weak job growth and rising wages will paint a clearer picture of stagflation, which could push gold prices out of the current consolidation.

Preview this week

This Wednesday (May 1) will usher in the U.S. ISM Manufacturing PMI for April and the Federal Reserve’s monetary policy decision.

The market expects the Federal Reserve to keep its policy interest rate unchanged at 5.25%-5.5%. The Fed is unlikely to provide any new hints on the timing of a policy shift in its statement. However, at the press conference after the meeting, Fed Chairman Jerome Powell will most likely be asked whether a rate cut is still possible in June. If Powell does not close the door to a rate cut in June, the initial reaction may cause U.S. Treasury yields fell sharply and boosted gold.

After the March policy meeting, Powell noted that strong inflation data in January and February could be due to seasonal factors. Market participants will also be closely watching Powell's comments on the inflation outlook.

If Powell adopts a concerned tone on recent inflation developments, the dollar could remain resilient against its rivals, limiting gold's upside. Finally, if Powell downplays the disappointing first-quarter GDP data, investors may view this as a hawkish tone, making it difficult for gold to gain upward momentum.

The U.S. Bureau of Labor Statistics will release the April employment report and April ISM non-manufacturing PMI this Friday (May 3). The market expects the number of new jobs to drop from 300,000 to 210,000.

Ten Wall Street analysts participated in the survey last week, and their views were basically consistent with those of the previous week. Seven experts (70%) expect gold prices to climb in the coming week, while two analysts (20%) expect gold to continue trading sideways, and similarly, only one analyst (10%) predicts prices to fall.

Meanwhile, in an online poll of retail investors, with 155 votes cast, 74 retailers (48%) expected gold prices to rise in the coming week. Another 46 people (or 30%) predict that prices will fall, while 35 people (or 22%) expect the precious metal to experience a volatile trend in the coming week.

Marc Chandler, managing director of Bannockburn Global Forex, believes that "gold in the spot gold market is supported by $2,300, and it can test $2,370 in the next few days. I suspect the real test will be the U.S. employment data in April." The Fed Open Market Committee meeting was held first, but hawkish support was widely expected as service PMI and small business surveys warned of downside risks to the economy.

"A disappointing jobs report could weaken the dollar and lower interest rates, raising gold prices," Chandler said.

Saxo Bank’s Hansen described gold’s price action so far as a healthy correction. He added that he expects the next major support level to be around $2,255 an ounce. "Remaining above this level would send a signal to the market that the pullback is nothing more than a weak correction in a strong upward trend," he said. Although the Fed and Friday's non-farm payrolls report will be the two major economic news in the week ahead. event, but there is still a lot of data to be released, which will increase volatility in the week ahead.

Adrian Day, president of Adrian Day Asset Management, also expects gold trading to rise in the coming week. "Buying is rising around the world. Central banks are still net buyers of gold on a comparable scale, if not slower so far this year than in the past two years," he said.

"Chinese consumer buying has picked up this year and now North American buyers are turning, albeit slowly, but still. After a steady and relentless sell-off for most of last year and earlier this year, gold ETFs There are some inflows starting to happen. Investors, both individual and institutional, are extremely underweight gold, so even a slight shift in buying patterns could be a huge buy."