Today’s NFP report shows mixed numbers, but it has been enough to stall further upside in the gold price.
Employment change registered at 245K, which was less than last month’s lower revision of 610K and less than the market forecast of 480K. The unemployment rate dropped from 6.9% to 6.7%, which outstripped the expectation of a drop to 6.8%.
Markets had expected a slowing in US employment, given the private sector employment numbers on Wednesday. However, yesterday’s decline in the Initial and Continuing Jobless Claims numbers shows that the US labour market is maintaining some resilience despite strong headwinds from pandemic-related economic pressures.
Gold price is presently down slightly on the report, as it trades at basically flat at 1841.38.
Technical Levels to Watch
The daily candle has formed a doji just under the 1850.78 resistance. This leaves gold prices more susceptible to other fundamental influences aside from the NFP report. Stimulus talk continues to weigh down the greenback and supports gold price ascent. A break of 1850.78 allows the XAUUSD to target the 1869.39 resistance, with 1881.99 serving as a critical price border where the flag’s previous lower boundary lies. Above this level, we may see some more convincing upside moves, which target 1900.76 or 1918.68.
On the flip side, failure to break 1850.78 could allow gold price to retest the 1821.55 and 1800.34 support levels, with 1788.90 and 1762.51 remaining in the picture as potential targets for the future if the decline is extensive.
It is also possible we could see gold price trading in a range that extends from 1821.55 to 1850.78 for some time if there are no fundamentals that are strong enough to push price out of this range.
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Gold Price Daily Chart
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