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  • Gold prices were buoyed on Friday following a disappointment in the headline Nonfarm payrolls number.  
  • The DXY fell, stocks declined, US yields popped and dropped between 2.6480% and 2.6220% and declined to 2.6210% in recent trade, (the low was 2.6050%).
  • Gold rallied to a high of $1,300oz from within the day’s range of $1,285/00.80oz.

Currently, the price of gold is steady at around $1,298.00 as we head into the close for the week with prices ending slightly above last week’s close at $1,293.06oz.  

The nonfarm payrolls data arrived as follows:  

20k vs 180k headline – This is the worst since Sept 2017. the prior was 304K and revised to +311K. However, not all is bad in the detail of the report.  

  • Two-month net revision +12K
  • Unemployment rate 3.8% vs 3.9% expected
  • Participation rate 63.2% vs 63.2% prior
  • Avg hourly earnings +0.4% vs +0.3% exp
  • Avg hourly earnings 3.4% y/y vs +3.3% exp
  • Private payrolls +25K vs +170K exp
  • Manufacturing +4K vs +12K exp
  • U6 underemployment 7.3% vs 8.1% prior

The DXY dropped from 97.40s to a low of 97.25 and then chopped sideways for the rest of the day between 97.31/43 (Besides the drop, the dollar is still strong following the break-up from the H&S neckline at 96.60/70 area ( At a 10-year high, wage growth for American workers likely to keep accelerating and that is something from the jobs data that is supporting the greenback (as well as dovish ECB/RBA/BoC). Post the data, gold rallied between the hourly stick’s range of 1291.40 and 1299 and went onto print the $1,300 high as the dollar lost traction, drifting sideways into the close.

Gold levels

Gold prices climbed from the 1280 lows, 5 dollars short of the  38.2% Fibo at 1275. Gold broke the 1296 resistance to go onto score the 1300 psychological level, just 2 bucks shy of the 23.6% retracement that gave out in recent sessions to the downside. 1315 is the next key target that meets the trend line prior support of the rising channel. However, stochastics is overbought between the 1hr and 4hr time frames. RSI, on the other hand, shows room to go to the upside while MACD meets late Jan peaks – all of which point to a phase of consolidation with a bullish bias. On the flipside, however, a break of the 38.2% and long term horizontal support will pen risk to 1264 and 1254. The key downside target will come as the 61.8% Fib of the same range down in the 1230s.