Gold Price Rises on Higher US Unemployment, Resistance at $1,593.00 Eyed
Gold price rose in Friday’s trading following the mixed labor figures from the US. XAUUSD traded higher after the release of the NFP report and bottoming out at $1,560.44. By the end of the New York session, gold price had settled $3.71 higher from its opening price at $1,569.96.
Labor figures for January came in mixed on Friday. The NFP report came in well beyond expectations at 225,000 versus the 163,000 forecast. This stellar job growth allowed the US dollar to finish higher against all of its major counterparts. On the other hand, other components of the labor report disappointed and could help explain why XAUUSD ticked higher. Average hourly earnings only rose by 0.2% and missed estimates at 0.3%. More importantly, the unemployment rate crawled higher from 3.5% to 3.6% for the month.
While a single labor market report is not enough for the Federal Reserve to shift its monetary stance, Friday’s release does raise speculations about the health of the economy.
Gold Price Outlook
On the 4-hour time frame, we can see that gold price pulled back some of its losses to the 61.8% Fib level (when you draw from the high of February 3 to the low of February 5). A shooting star has already materialized which is often seen as a bearish reversal signal. It could mean that XAUUSD may soon resume its fall to support around $1,551.00.
On the other hand, the hourly chart reveals that the short-term uptrend on gold price is still intact. By connecting the lows of February 5, February 6, and February 7, support at the rising trend line is still holding at $1,570.00. The 200 SMA is also providing the precious metal with support. Reversal candles around this price could indicate that there are still enough buyers in the market to possibly push XAUUSD to resistance at $1,593.00.