Gold Price Forecast: XAU/USD stalling on the bid as traders eye NFP and Ukriane crisis peace talks

• Gols stalls on the bid as traders look for another catalyst.
• The price meets a 50% mean reversion where it meets old resistance turning to support. 

The gold price is stalling on the bid. At $1,929, the precious metal is barely in the green by 0.02% ranging between $1,922.11 the low and $1,938.83.  

A "wait and see" theme has formed in financial markets as investors search for the next catalyst from developments in the Ukraine crisis and economics. Russian and Ukrainian negotiators meet in Belarus today for peace talks as the war enters its second week.

US stock indexes are mixed with just modest changes early on Thursday. The US dollar, however, has been supported by comments from Federal Reserve Chairman Jerome Powell. Powell gave his insights for a second day of testimony to Congress, after saying on Wednesday that he would support a 25-basis-point hike at the Fed's March 15-16 meeting.

Powell repeated comments that he made before the House Financial Services Committee on Wednesday, noting uncertainty due to the invasion of Ukraine but insisting that inflation needed to be contained. He said that the FOMC will act cautiously and be nimble in reducing policy accommodation.

The tone was more dovish than the previous commentary, however,  he also said he would be willing to raise interest rates at a faster pace than 25 basis points in subsequent meetings if inflation does not slow as expected. It is worth noting that there have been calls for at least 100 basis points of tightening by July 1. This would mean that at least one 50-basis point hike will come between then and now.

NFP in focus

The US jobs data will be under the microscope in this regard. On Friday, the Nonfarm Payrolls will be key. Earlier Thursday, data showed the number of Americans filing new claims for unemployment benefits dropped to their lowest level this year last week. For Friday's data, analysts are anticipating another month of solid job growth.

Employment likely continued to recover in February following an unexpectedly strong Jan report—despite the Omicron-led surge in COVID cases, analysts at TD Securities explained.

''We expect some of that boost to fizzle, though to still firm job growth pace. Seasonal adjustments were a factor last month and they will likely play a role again in Feb. We expect wage growth to slow to a still strong 0.5% m/m pace.''

Meanwhile, the analysts at TDS also said ''the war in Ukraine has significant and obvious implications for commodities prices, which could lead to a more persistent inflationary shock.''

For the time being, direct implications of the conflict as a growth shock are more limited in the US, given that direct trade flows are marginal. But indirect implications are more relevant as ongoing disruptions to supply chains are likely to have a spillover effect, while inflation is also likely to act as a tax on consumers.''

Gold technical analysis

The price has pulled back into a 50% mean reversion where it meets old resistance turning to support.