Gold price maintained its bullish response on the day following a mixed Non-Farm Payrolls (NFP) report. The Department of Labour reports that the US added 661K jobs to the economy in September, which was well short of August’s 1371K jobs and also below the market expectation of 900K. The unemployment rate dipped to 7.9%, which was lower than the expected number of 8.2% and also below last month’s 8.4%.
The numbers indicate that the US jobs market recovery is slowing down further, as the coronavirus continues to haunt the US economy relentlessly. Without any additional stimulus in sight, the sector continues to struggle. Still, it leaves the US economy far away from reclaiming the nearly 22 million jobs lost at the 1st height of the pandemic in March and April. Payrolls had surged in August when the conduct of the US census led to the hiring of nearly 250,000 ad hoc workers.
On Thursday, United Airlines and American Airlines said they would have to furlough 32,000 workers as stimulus assistance from the US government dries up. News of President Trump’s coronavirus infection is driving flight to safety, and the jobs numbers may have strengthened this market stance.
Gold prices are now trading at 1907.68, trading a little lower than intraday highs at 1917.10.
Technical Outlook for XAUUSD
Gold prices maintain their march towards 1920 following yesterday’s violation of 1900.76. Today’s candle needs to close above this level to confirm the breakout. Above 1918.68 lies 1950.15 and 1954.77, which are potential targets above the current price levels.
On the flip side, a decline to retest 1900.76 could be a consequence of lack of follow-through action, with 1850.29 (78.6% Fibonacci retracement) and 1821.61 also lining up as potential targets to the downside.
On the flip side, immediate support for Dow Jones index is at 25,096 the low from yesterday. Next support for the Dow Jones will be met at 24,952 the 50-day moving average. A break below 24,952 might open the way for a test of 24,755 the 100-day moving average.
XAUUSD Daily Chart