The yellow metal is trading low against the greenback due to Upbeat US macro data and uptick in the US bond yields.

According to the ADP National Economic Report released Thursday, U.S. private-sector employment surged by 978,000 in May, this gain was above forecasts from economists with a record of 923,000 jobs.

It is to be noted that this is the largest monthly gain since last June when the economy began to reopen after the first wave of the coronavirus pandemic. The private-sector added a revised 654,000 in April, down from the prior estimate of 742,000. This robust jobs report coupled with dollar strength puts intense selling pressure on gold.

Elsewhere, The U.S. weekly jobless claims drop below 40k with record of 385k, the figure is well below the expectation of 425k and previous record of 405k.Even the U.S. service sector index is at record high in May,

The Signs of a strengthening US economy has boosted bets for higher inflation and further created hopes on the speculations that the Fed may bring forward the timeline for tapering its bond purchases. This was evident from a fresh leg up in the US Treasury bond yields, which provided an additional support to the greenback

We’re coming out of the woods here, the data is getting better, there are some inflation issues that could put a damper on things, but we have turned the corner,” Bob Haberkorn, senior market strategist at RJO Futures, said.

The better-than-expected data has put traders on the defense. They’re preparing for possible statements from the Federal Reserve on tapering or higher rates, although not immediately.

XAU/USD 4 Hour Chart:

Support: 1854.0 (S1), 1837.4 (S2), 1809.6 (S3).

Resistance: 1898.3 (R1), 1926.1 (R2), 1942.7 (R3).

Amidst the US macro data and hopes on US economy recovery favors the greenback against the precious metal; the next focus will be on U.S. nonfarm payroll numbers due on today. We expect a bearish trend for XAU/USD.