Gold (XAU/USD) prices have ticked up following the release of weaker-than-expected US ADP Employment figures. The pair is approaching Tuesday’s highs at $2,040 after having found support at the $2,000 psychological level, on its reversal from the all-time highs at $2,150. US Treasury yields have turned lower as the weak ADP cast doubt about Friday’s Nonfarm Payrolls data. These figures confirm that the US labor market is losing momentum, which adds reasons to think that the Federal Reserve (Fed) might start easing its monetary policy early next year. Data from Tuesday offered a mixed picture. The US ISM Services PMI beat expectations, but the US JOLTS job openings survey showed that the labor market is starting to feel the pinch of higher interest rates. Investors’ focus is now on the Nonfarm Payrolls report, due on Friday, which will be scrutinized with interest for further cues into the Fed’s monetary policy plans.

From a technical perspective, Gold prices remain in a consolidation mood. Downside attempts are contained above a key support area at $2,000, while upside attempts are capped below the $2,040 level. The broader bullish trend has lost steam after breaking the 50% Fibonacci retracement level of the November 13 – December 5 bull run. Beyond that, Gold’s inverse correlation with a stronger US Dollar suggests that further decline should not be discarded. On the downside, a confirmation below the $2,000 support area would negate the broader upside trend and increase bearish pressure towards $1,950 and $1,932. On the upside, a bullish reaction above $2,040 would clear the path towards $2,067, ahead of the record-high $2,150. The table below shows the percentage change of the US Dollar (USD) against listed major currencies this week. The US Dollar was the weakest against the Canadian Dollar.