GLD ETF analysis: Is gold a buy or sell ahead of key events?

GLD ETF, which tracks gold price bounced off the support zone of $370 on Tuesday, even as the US data fog weighs on financial markets. On the one hand, uncertainties have propped gold price above the crucial support level of $4,000 an ounce. However, expectations of a hawkish Fed have curbed its upside potential. Investors are now eyeing September’s US jobs report and Nvidia Q3 earnings report. 

GLD gold price bounces off crucial support

Gold price has been under pressure in recent sessions despite the risk-off mood. The fear & greed index, which highlights the key emotion driving the market, has shifted from a fear level of 34 a week ago to an exteme fear of 14. 

Ordinarily, fear bolsters gold price as investors rush to secure their resources in precious metals and other safe-haven assets. Indeed, it is this fear that has held the bullion steady above the crucial zone of $4,000 an ounce. 

Gold ETF purchases from institutions and individual investors remain robust amid concerns over AI tech stock valuations and the overall health of the global economy. For instance, according to the World Gold Council, Chinese gold ETFs added about $4.5 billion in inflows in October. Notably, that is the highest figure since April this year. At the same time, global gold ETFs are expected to report the strongest year on record as the steady gold price uptrend fuels hefty inflows. 

However, in the short term, the US data fog may continue to weigh on gold price and its derivatives. On Thursday, the US Labour Department is set to release September’s job report as the delayed economic data begins to trickle in. 

While the figures will offer clues on the Fed’s interest rate outlook, they may be dated. Even so, the market is also pricing in a hawkish Fed ahead of its December meeting. The non-yielding bullion tends to be more attractive in an environment of lower interest rates. 

In addition to these drivers, gold price will likely react to the Nvidia Q3 earnings slated for release on Wednesday. At a market cap of $4.67 trillion, the report is expected to trigger immense volatility across the financial markets amid concerns over the AI industry. Any form of weak guidance may fuel a global selloff that could heighten gold’s safe-haven appeal.  

GLD ETF technical analysis

GLD ETF stock chart | Source: TradingView

Bulls successfully defended the support at $370 after momentarily dropping below it i the previous session. Even with the pullback, it continues to trade above the short-term 25-day EMA, a sign that the bulls are still in control. Besides, at an RSI of 52, the asset has ample room to rebound and retest recent highs.

In the near term, it may trade within a tight range of between $370 and $385 as the market awaits crucial economic data. At the same time, the ease in prices may attract more buyers; bolstering the ETF to the upper resistance level of $397 as the bulls strive to retest October’s high of $400. 

Even with a pullback past the range’s lower border, I expect the support at $360 to remain steady with the bullion’s robust safe-haven appeal.