International gold price short term look at $1737 provider FX678

On Wednesday (October 5), the international gold price was under pressure, but not far from the new high of $1,729.35 per ounce since September 13, set overnight, with a short-term view of $1,737. As investors avoid taking bigger steps ahead of key US jobs data. The data may affect the Fed’s policy tightening path.

At 15:19 Beijing time, spot gold fell 0.36% to US$1,719.85 an ounce; the main COMEX gold futures contract fell 0.10% to US$1,728.7 an ounce; the US dollar index rose 0.31% to 110.528.

The US benchmark closed down more than 1.3 percent overnight, its biggest one-day fall since March 2020. A government survey released overnight showed that US job vacancies fell by the most in nearly 2-1/2 years in August, suggesting that the labor market is cooling.

City Index analyst Matt Simpson said if the ADP jobs data is weak, gold could break the key resistance level of $1,735. He added that the market is very sensitive to employment data at the moment.

The September ADP employment report in the United States will be released at 20:15 Beijing time on Wednesday, with employment expected to increase by 205,000. It will be followed by US September non-farm payrolls data to be released this Friday (October 7).

“If the ADP data falls short of expectations, traders may assume poor September nonfarm payrolls and be bearish on the dollar, as traders have recently started betting on a Fed policy change, which in turn favors gold,” he said. Simpson.

But recently, Fed officials reiterated their commitment to continue to fight inflation and avoid stubbornly high inflation. Although gold is traditionally seen as an inflation hedge, rising US interest rates have eroded the appeal of the non-yielding asset. Gold is down almost 6% since the start of the year.

On the hourly chart, gold price has started a iii-wave upward trend from $1,641, approaching the 185.4% target of $1,730, and further looking at the 200% target of $1,737. Wave iii is a sub-wave of the upward wave (i) that started at $1615.