Gold price tumbles as PBoC keeps Gold buying on hold

• The Gold price loses momentum below the $2,400 barrier on Monday. 
• Yellow metal edges lower as China's Central Bank has stopped buying for the second month in June. 
• The expectation that the Fed would cut the rate in September might cap the XAU/USD’s downside. 

The Gold price (XAU/USD) attracts some sellers during the Asian session on Monday. The precious metal loses traction as the People’s Bank of China (PBoC), the Chinese central bank kept Gold buying on hold for the second month in June, according to official data released on Sunday. It’s worth noting that China is the world’s biggest bullion consumer, and the pause in gold buying could weigh on the Gold price. 

On the other hand, the rising speculation that the US Federal Reserve (Fed) would cut the interest rate in the third quarter might lift the non-yielding Gold price. Furthermore, the political uncertainty in France after exit polls indicated the final round of the French parliamentary elections pointed to a hung parliament, which might boost safe-haven assets like Gold. Traders will take more cues from the Fed's Chair Jerome Powell, who testifies on Tuesday ahead of the US June Consumer Price Index (CPI) inflation data on Thursday. 

Daily Digest Market Movers: Gold price loses ground as PBoC refrained from gold purchases for a second month

• The US Nonfarm Payrolls (NFP) rose 206K in June, following the 218K rise (revised from 272K) recorded in May. This figure came in above the market expectation of 190,000.
• The Unemployment Rate ticked higher to 4.1% in June from 4% in May. The Average Hourly Earnings, wage inflation, dropped to 3.9% YoY in June from 4.1% in May, in line with market expectation. 
• The recent employment data have raised the chance of a rate cut from the Fed in September, with the markets pricing 77% odds, up from 70% before the report. 
• In a shock result, polls indicated the left-wing New Popular Front (NFP), led by Jean-Luc Mélenchon, seems to be on track to win the most seats in the second voting round of French parliamentary elections on Sunday, per The Economist.
• "It appears that gold prices remain a little too high, and the PBoC is waiting for a further pullback before resuming its gold purchasing programme," said Nitesh Shah, a commodity strategist at WisdomTree.

Technical Analysis: Gold price keeps the bullish vibe in the longer term

The gold price edges lower on the day. Technically, the yellow metal maintains the bullish trend on the daily chart as it holds above the key 100-day Exponential Moving Average (EMA). The precious metal sustains a breakout above a descending trend channel that formed on May 10. The path of least resistance of Gold is to the upside as the 14-day Relative Strength Index (RSI) stands in the bullish zone above the 50-midline. 

The first upside barrier for XAU/USD will emerge at a $2,400 psychological level. The additional upside filter to watch is $2,432, a high of April 12. The next potential resistance zone is seen at an all-time high of $2,450. 

On the downside, the initial support level for the yellow metal is located at the $2,330-$2,340 zone, representing a low of June 17 and the former resistance zone. Extended losses could see a drop to $2,273, the 100-day EMA.