I really think that the negotiation is up to you and the seller. Here are a few things for you to think about in general.
- Have you actually tried 34mm and 36mm Rolex models on your wrist? Some people feel that 34mm is fine, but others find it too small. If you haven't tried them in-person, I wouldn't jump into a purchase yet.
- Is it important for you to have a gold-colored Rolex? If so, then your options are quite limited in this price range. For an additional $1k, you can get into a decent SS DJ, but the entry point for solid gold Rolex watches is quite a bit higher. So if you really want a "golden" Rolex, maybe this is the reference you can afford, and they aren't terribly common, so that could influence the price you are willing to pay.
- It is almost always better to buy the bracelet and watch together instead of buying the watch and trying to find the bracelet afterwards.