Gold Price Forecast: XAU/USD looks to open positive around $1,960 amid risk-on impulse

• XAU/USD eyes a positive start following the rebound in the gold prices last week.
• Fed policymakers are claiming an aggressive interest rate elevation to curtain the inflation mess.
• US Nonfarm payrolls will be the major event to keep under the radar.

Gold (XAU/USD) ended the last week on a flat note despite remaining subdued in the initial sessions. The precious metal slipped near a low of $1,910 last week but found responsive buying, which managed to push the gold prices higher and it closed almost fast. The responsive buying witnessed in the last week’s end is likely to bring a carry-forwarded buying, which hopes a flat-to-positive opening on Monday.

The responsive buying from the market participants came last week despite the rising odds of a 50 basis points (bps) interest rate hike by the Federal Reserve (Fed). The expectation of a serious elevation in the interest rates banks upon soaring inflation in the US. To curtail the inflation mess, Fed policymakers are left with no other option than to raise interest rates in May monetary policy. Meanwhile, the labor market in the US is in the optimal state therefore price stability remains the second major catalyst to be focused by Fed Chair Jerome Powell and his colleagues.

Meanwhile, NY Fed President and influential Federal Open Market Committee (FOMC) member John Williams said on Friday that the speed of interest rate hikes this year should be driven by the data, reported Reuters.

The US dollar index (DXY) closed near 98.85 last week on broader expectation of a 50 bps interest rate hike considering the speeches from the FOMC members.

Going forward, the unfolding of the US Nonfarm Payrolls will remain the major trigger to rain under the radar.  The Employment data is likely to land at 488K much lower than the previous print of 678K.

Gold Technical Analysis

XAU/USD has balanced in a range of $1,943.90-1,966.54 after turning imbalance from its previous consolidation range of $1,910.83-1,949.80. The precious metal has been stabilized above 200-period Exponential Moving Average (EMA) at $1,943.58.

Gold prices are likely to extend gains after overstepping 38.2% Fibonacci retracement (which is placed from March 8 high at $2,070.54 to March 16 low at $1,895.15) at $1,962.20.

Gold hourly chart