Gold: Preparing for a deeper correction or setting up for a fresh rally? All eyes on the U.S. labor report for further clues

Gold prices continued to decline on Wednesday, following the loss of the key psychological support level at $2,500, signaling the potential for a deeper pullback.

The drop below the 20-day moving average (DMA) at $2,489 weakened pivotal Fibonacci support at $2,473 (38.2% retracement of the $2,379 to $2,531 rally), further dampening the near-term outlook.

A daily close below the 20DMA would reinforce this bearish signal, while a clear break of the $2,473 Fibonacci level would confirm it.

Although technical indicators on the daily chart are showing signs of weakness, the overall trend remains positive, suggesting that this pullback could be a healthy correction before the larger bullish trend resumes.

Gold continues to be supported by geopolitical tensions and the prospect of U.S. rate cuts, though recent indications that the Fed is likely to opt for a 25 basis point cut and avoid aggressive measures at the start of the easing cycle have weighed on prices.

Market attention is now focused on upcoming U.S. labor reports, which are expected to provide more insight and influence the Fed’s decision at the September monetary policy meeting.

Res: 2489; 2500; 2505; 2526
Sup: 2470; 2455; 2437; 2422