Gold Price Forecast: XAUUSD Acceptance above $2,670 is critical for XAU/USD, as US ADP data, Fed speak looms

• Gold price holds previous gains below record high, as traders digest Israel-Iran geopolitical risks.   
• The Dollar pauses recovery amid risk reset, ahead of US ADP data and Fedspeak.
• The daily technical setup favors Gold buyers, as the RSI stays firm in the bullish zone.

In Asian trading on Wednesday, the gold price is consolidating its previous recovery near $2,660. Buyers are taking a break amid the Iran-Israel geopolitical escalation while anticipating the critical US ADP Employment Change data and a flurry of lectures from US Federal Reserve (Fed) policymakers.

The gold price is influenced by US events and geopolitics.
The Asian markets have experienced a slight respite, despite the persistent apprehensions that an Iran-Israel conflict could escalate into a broader regional conflict. These markets are of the opinion that Iran may not initiate a full-scale war with Israel and would instead advocate for deescalation in the same manner as it did following the April missile strikes.
Iran’s Revolutionary Guard announced on Wednesday morning that its forces employed hypersonic Fattah missiles for the first time on Tuesday, and 90% of the missiles effectively struck their targets in Israel.

“Our action is complete, unless the Israeli regime elects to initiate additional retaliation.” In an early Wednesday post on X, Iranian Foreign Minister Abbas Araqchi stated that our response would be more robust and forceful in that scenario.

Tehran declared that this assault was in retaliation for Israeli aggression against the Iran-backed armed movement Hezbollah in Gaza and the death of militant leaders in Lebanon.

The traditional secure haven, Gold, is expected to face renewed selling pressure if Middle East geopolitical tensions subside without any additional potential aggression from Israel.

Nevertheless, the US ADP Employment Change data and Fedspeak will be the next significant events for the US Dollar and Gold price, as they could offer new insights into the magnitude of the next Fed interest rate cut. It is anticipated that the private sector employment in the United States will increase by 120,000 in September, compared to a 99,000 job gain in August.

The US ISM Manufacturing PMI and JOLTS Job Openings data from Tuesday were mixed and did not provide any distinct signals regarding the direction of the Fed’s interest rate outlook. In the interim, Raphael Bostic, the President of the Atlanta Federal Reserve, reiterated his willingness to consider “an additional half-percentage point rate reduction” in the event of unexpected weakness in the labor market.

Markets are currently pricing in a 37% probability that the Federal Reserve will reduce rates by 50 basis points (bps) in November, a decrease from the 53.3% that was observed at the beginning of the week, according to the FedWatch Tool of CME Group.

In addition, the news of Iranian bombings on Israel dominated markets and provoked a widespread risk-aversion surge, which increased the safety bets in the US Dollar, gold, and government bonds.