Gold, XAU/USD, Non-Farm Payrolls Report, IG Client Sentiment – Gold Briefing:
- Next week’s gold price is the worst in 2 months.
- US Non-Farm Employment Report may bring further volatility
- XAU/USD also risks taking longer bets from retail traders.
Gold prices were in for the worst week in two months, with the yellow metal falling about 3.7% before the weekend approached. The main driver of the gold slump this week was the stronger US dollar. The strength of the dollar this week appears to be mainly due to external factorsThe latter includes monetary policy issues in Europe and developed countries that pose a risk to global growth forecasts.
On Thursday, Fedspeak appeared to play a key role in improving market sentiment, the Fed’s Christopher Waller and James. Bullard stressed the central bank had a “good” chance of a soft landing. This sentiment is likely to weaken the US dollar. This allows the anti-fiat gold price to find a firm footing after significant losses earlier this week.
Things will get even more interesting in the remaining 24 hours. All eyes are on the June nonfarm payrolls report. The US added 268k jobs, down from 390k in May. But there may be more emphasis on average hourly earnings. Year-over-year printing of 5.0% was seen, down from 5.2% earlier if the central bank were to stick to inflation expectations. Watching wages is of utmost importance.
The Citi US Economic Surprise Index remains sharply negative. This is a sign that analysts are overestimating the condition of the economy. It opens the door to surprising disadvantages in data. The worrisome signal for the Fed could come in the form of fewer or negative job increases while earnings remain strong. That could raise concerns about stagflation, so gold volatility may continue to rise.
gold technical analysis
Gold prices have confirmed a breakout under the 1787–1810 support zone, later past the December 2021 low at 1753 over the last 24 hours. The price has left behind. Gravestone Doji candlestick pattern. This is a sign of uncertainty that following upside may indicate future profits. in such a case The 20-day Simple Moving Average (SMA) could be the main resistance. Otherwise, further losses are highlighted at the September 2021 low of 1722.
Daily chart XAU/USD
Charts created using TradingView.
Gold Sentiment Trend – Bearish
the IG Customer Confidence (IGCS) measure This shows that approximately 87% of retail traders are gold with a net worth. IGCS tends to act as an opposite indicator. As a result, as most traders hold long positions, this indicates that XAU/USD could fall sharply. continuously Upside exposure was up 5.36% and 8.29% compared to yesterday and last week, respectively. The combination of current sentiment and recent changes creates a more opposite trading bias against bear markets.
–— written by Daniel Dubrovski, strategist For DailyFX.com
To contact Daniel Use the comments section below or sergeant on twitter