Gold Price Today, August 7: XAU/USD Holds Near $4,250 Before US Jobs Report

Key Takeaways

• Gold traded around $4,250 per ounce on Friday after gaining approximately 4.8% this week.
• Lower oil prices and reduced expectations for aggressive Federal Reserve tightening supported the precious metal.
• The July US nonfarm payrolls report could determine whether XAU/USD challenges $4,300 or begins a corrective pullback.

Gold Price Holds Near $4,250 After Strong Weekly Rally

Gold prices were relatively steady on Friday, August 7, with XAU/USD trading around $4,240–$4,260 per ounce during the Asian session. The precious metal is heading towards its strongest weekly performance since January after gaining approximately 4.8% since Monday.

Early market data placed spot gold at $4,235.57 per ounce, while subsequent quotes showed the price moving back towards $4,250. US gold futures traded near $4,294 per ounce. Price differences reflect the timing of each quote and the distinction between the spot and futures markets.

Friday’s limited price movement follows a dramatic rally earlier in the week. Gold surged more than 4% on Wednesday, recording its largest daily gain since February and briefly reaching $4,264.93, its highest level since June 18. The move also pushed XAU/USD decisively above its 50-day moving average near $4,160, improving the short-term technical picture.

Lower Oil Prices Support Gold’s Weekly Recovery

Changes in oil prices have become an important driver of the gold market because of their effect on inflation and interest-rate expectations.

Earlier optimism surrounding negotiations to reopen the Strait of Hormuz pushed crude oil prices sharply lower. Falling energy prices reduced concerns that the Middle East conflict would cause another acceleration in global inflation. This encouraged traders to reduce expectations for aggressive Federal Reserve interest-rate increases, supporting non-yielding assets such as gold.

However, oil prices recovered on Friday after doubts emerged over the proposed reopening framework. Iran is considering restrictions on vessels linked to countries it regards as hostile, including the United States and Israel. Brent crude moved back above $83 per barrel, partially reversing its earlier decline.

Renewed oil strength could limit further gold gains. Higher energy prices may keep US inflation elevated and increase pressure on the Federal Reserve to maintain restrictive monetary policy. Gold does not generate interest, so higher bond yields generally increase the opportunity cost of holding the metal.

At the same time, continued instability around the Strait of Hormuz provides some safe-haven demand. Gold is therefore caught between the supportive effect of geopolitical uncertainty and the negative interest-rate implications of higher oil prices.

US Nonfarm Payrolls Become the Next Gold Price Catalyst

The July US nonfarm payrolls report is scheduled for release at 12:30 GMT.

The market consensus points to an increase of approximately 80,000 jobs, compared with 57,000 in June. The unemployment rate is expected to remain unchanged at 4.2%.

Recent labour-market indicators have been mixed. Initial unemployment claims edged up to 199,000 in the latest week, but planned layoffs fell to their lowest level in two years. This suggests that the labour market is slowing without experiencing a sharp deterioration.

A payroll result below expectations could weaken the US dollar and reduce Treasury yields. That combination would normally support gold because dollar-denominated bullion becomes less expensive for buyers using other currencies, while lower yields reduce the cost of holding a non-interest-bearing asset.

A stronger report could have the opposite effect. Robust job creation or unexpectedly high wage growth could reinforce expectations that the Federal Reserve will raise interest rates to control inflation. This could lift the dollar and Treasury yields, creating pressure on XAU/USD.

Markets currently price in roughly a 55% probability of a September rate increase. The Federal Reserve left its target range unchanged at 3.50%–3.75% on July 29, but several policymakers have subsequently indicated that further tightening may be required if inflation remains above the 2% target.

Gold Price Levels to Watch Today

The short-term gold price structure remains constructive following Wednesday’s breakout. XAU/USD is trading above both its 20-period and 100-period moving averages on the four-hour chart, which are positioned near $4,146 and $4,073 respectively.

Immediate support is located around $4,248, followed by $4,232. If gold falls below this area following the US jobs report, the next important support could appear around $4,200. A deeper correction may bring the former breakout area and 20-period moving average near $4,146 back into focus.

On the upside, initial resistance is positioned around $4,276. A sustained break above this level could allow XAU/USD to test the psychologically important $4,300 area, with the next technical barrier near $4,304.

The four-hour Relative Strength Index is near 72, placing the market in overbought territory. This does not automatically signal a reversal, but it suggests that gold may be vulnerable to profit-taking if the US employment data supports the dollar.

Conclusion

Gold is trading near $4,250 on August 7 and is on course for its strongest weekly gain since January. Lower energy prices, a softer dollar and reduced expectations for aggressive Federal Reserve tightening helped XAU/USD break above several important technical levels earlier in the week.

The July US jobs report is now the immediate catalyst. Weak payroll growth could support a move towards $4,276 and $4,300, while stronger employment or wage figures could trigger profit-taking towards $4,232 and $4,200. Renewed volatility in oil prices and developments surrounding the Strait of Hormuz will remain important secondary drivers for the gold price.