## US-Vietnam Trade Agreement Promotes Gold Rebound, Non-Farm Payroll Data Becomes Market Focus

**Gold technicals show bullish signals, buying on dips remains the mainstream strategy**

From a technical perspective, the breakout above the 200-hour simple moving average this week marks an important bullish initiation point for XAU/USD. The oscillator on the daily chart is regaining upward momentum, indicating minimal resistance for gold prices to move higher. This suggests traders can focus on support levels around $3,330-3,329 (200-hour SMA) when positioning on dips. A confirmed break below this support could lead to further declines toward the $3,300 round number. On the upside, the $3,363-$3,365 zone acts as a direct resistance; a successful breakout could target $3,400. Continued strength might push prices toward the next key barrier at $3,435-$3,440.

**US-Vietnam agreement eases risks, but dovish Fed expectations still support gold**

On Wednesday, the Trump administration announced a trade deal with Vietnam—reducing tariffs on imports from the country to 20% and securing tariff-free access to the Vietnamese market. This news alleviates market concerns over prolonged trade disputes, triggering a risk-on sentiment that led to selling pressure on safe-haven assets like gold. Meanwhile, the US dollar has modestly risen, adding further pressure on non-yielding precious metals.

However, market expectations still broadly believe the Federal Reserve will initiate a new rate-cut cycle. The disappointing ADP private-sector employment report released on Wednesday further reinforced this outlook. Coupled with concerns that US fiscal health may worsen after the implementation of Trump’s budget plan, these factors should help limit the dollar’s gains and support gold.

**Weak employment data signals caution, non-farm payrolls to set short-term trend**

The US labor market shows clear signs of deterioration. Automatic Data Processing (ADP) reported that private-sector employment in June declined for the first time, dropping over 33K, well below the revised increase of 29K. Subsequent Job Openings and Labor Turnover Survey (JOLTS) data also confirmed a weakening hiring environment. Such soft employment prospects could prompt the Fed to cut rates earlier.

Currently, traders estimate about a 25% probability of a rate cut at the Fed’s July 29-30 meeting, with a near certainty of a 25 basis point cut in September. The market expects two rate cuts before the end of this year. Given this, dovish Fed expectations should suppress the dollar’s rebound and provide support for gold prices.

The market’s focus now shifts to the upcoming non-farm payroll report, which will be a key indicator for the Fed’s rate path and short-term gold trends. Traders should watch whether this report further confirms a weakening labor market trend.