Gold News: Traders Eye $3347.97 Pivot as ADP Report Could Fuel Gold Rally

Gold Holds Above 50-Day Moving Average as Traders Eye ADP Data

Gold prices are inching higher on Wednesday, testing the short-term pivot at $3347.97 that could trigger a broader breakout if momentum strengthens. Tuesday’s session briefly cleared this level, reaching $3358.09 before stalling as traders stepped back ahead of this week’s critical U.S. labor data.

At 10:48 GMT, XAU/USD is trading $3344.28, up $5.56 or +0.17%.

ADP Jobs Data in Focus as Fed Rate Cut Bets Hold Steady

The June ADP employment report later today will be closely monitored for fresh signals on the labor market, setting the stage for Thursday’s non-farm payrolls. Recent JOLTS data showed job openings unexpectedly rose, but a decline in hiring indicates a slower labor market.

The Federal Reserve’s current stance remains cautious, with Chair Jerome Powell emphasizing a “wait and learn” approach regarding tariffs’ impact on inflation before any rate cuts. Markets continue to expect multiple rate cuts this year, with weak labor data likely to reinforce this view, providing underlying support for gold prices.

Debt Concerns and Treasury Yields Add Tailwinds for Gold

The passage of Trump’s tax and spending bill in the Senate, adding $3.3 trillion to the national debt, pushed the 10-year Treasury yield up to 4.251% as traders digested the growing deficit risks.

The 2-year yield climbed nearly 6 basis points to 3.779%, reflecting uncertainty about the bill’s future in the House and its inflation implications. Higher yields often weigh on gold, but persistent debt concerns and the Fed’s caution on additional tightening could continue to underpin gold’s medium-term support.

Inflation Watch: ISM Data Flags Price Pressure

June ISM manufacturing data showed the index at 49.0, indicating contraction, but the prices paid component edged up to 69.7 from 69.4, highlighting sustained input price pressures.

Analysts warn that tariff-driven price increases could keep inflation stickier, potentially limiting the Fed’s flexibility on aggressive rate cuts while keeping real yields constrained—a favorable backdrop for gold.

Gold Prices Forecast: Breakout Potential Hinges on ADP Impact

Gold’s immediate support rests at the 50-day moving average at $3321.60 and the secondary pivot at $3310.48. A break below $3310.48 could trigger a retest of Monday’s low at $3244.41.

However, if today’s ADP data shows labor market weakness, it could fuel rate cut bets, weaken the dollar, and trigger renewed momentum above the $3347.97 pivot toward last session’s high at $3358.09. If cleared with conviction, the next target will be the psychological $3400 zone.

Overall, gold maintains a cautiously bullish outlook, with breakout potential contingent on the ADP report signaling further labor market cooling and reinforcing Fed rate cut expectations.

More Information in our Economic Calendar.