Will Gold Price Stabilize Near $4,450 Amid Weakening Safe-Haven Demand?

XAU/USD retreats to the $4,450 mark as geopolitical anxiety loses its grip on markets. The precious metal’s upward trajectory has stalled in Thursday’s early Asian hours, reflecting a classic pattern of profit-taking among traders. Following the recent surge in the gold price, market participants are reassessing positions, particularly as immediate geopolitical flashpoints appear to be cooling.

Market Sentiment Shifts Away from Protective Assets

The cooling of safe-haven demand represents a significant headwind for the US dollar gold price. Traders had flocked to precious metals when geopolitical tensions spiked over the weekend, but as those concerns fade into the background, the urgency to hold defensive positions diminishes. David Meger from High Ridge Futures captures this sentiment precisely: what we’re witnessing is a natural correction following the metal’s recent appreciation.

Economic Data Takes Center Stage for Gold Traders

The immediate focus now turns to Thursday’s weekly US Initial Jobless Claims release, but the real catalyst will arrive on Friday with the US December employment report. This data release holds particular significance for gold price movements because it directly influences Federal Reserve policy expectations.

Economists anticipate December will bring 60,000 new job additions to the US economy, with the Unemployment Rate expected to decline to 4.5%. Should these figures disappoint relative to forecasts, it would strengthen the argument for monetary easing from the Fed—a scenario that typically benefits non-yielding assets like the US dollar gold price. Here’s the mechanism: lower interest rates reduce the opportunity cost of holding gold, making the precious metal more attractive to investors seeking real returns.

The Path Forward for XAU/USD

The gold price dynamics hinge on whether employment data signals economic resilience or weakness. A softer-than-anticipated jobs report could reignite the gold rally, while stronger-than-expected numbers might push XAU/USD further toward resistance levels. Traders monitoring this week’s economic calendar should remain alert to Friday’s employment figures as the key price driver for precious metals.