Bangkok: Gold prices are showing signs of recovery following an increase in U.S. unemployment figures and the Federal Reserve’s indication of potential balance sheet expansion, according to GCAP Co., Ltd. (GCAP GOLD). The appeal of gold as a safe asset is being bolstered, with investors closely monitoring labor market statistics to confirm market weaknesses. Key support levels are identified between $4,075 and $4,025, indicating a potential rebound if prices remain below this threshold.
According to Thai News Agency, Ms. Areerat Murachai, Chief Analyst at GCAP GOLD, stated that gold prices are expected to recover within a limited range this week, following a sustained correction earlier. Concerns about the U.S. economy’s slowdown are evident, marked by a decline in the consumer confidence index and a surge in October’s Challenger, Gray and Christmas unemployment figures to 153,074, the highest in over two decades. This surge highlights labor market pressures and the economy’s fragility. The upcoming release of U.S. employment figures is being watched closely; a trend similar to the private sector would signal a weakening U.S. non-farm labor market, potentially leading to an interest rate cut by the Fed in December.
The market is also attentive to John Williams, President of the Federal Reserve Bank of New York, who suggested that the Federal Reserve might need to consider expanding its balance sheet again. Expectations are set for the Fed to commence this expansion in the first quarter of 2026, aiming to enhance liquidity in financial markets. This stance is anticipated to support gold’s renewed attractiveness as a safe asset.
GCAP GOLD analysts predict that gold prices are likely to continue rebounding if economic pressures persist and the Fed maintains signals of easing liquidity. Earlier in the week, gold prices rose beyond the sideways range of US$4,025, confirming a short-term upward trend. For prospective buyers, a dip to the support level of US$4,075-US$4,025 (approximately 62,700-62,500 baht in Thai gold price) presents an attractive opportunity. Short-term profit-taking resistance is pegged at US$4,160 (around 63,500 baht), with a potential move to US$4,210 (approximately 64,200 baht) if this resistance is breached.