Gold flat-lined above $1900 mark, unaffected by mixed US jobs report

• Gold remains confined in a range above $1900 mark and moved little on mixed NFP report.
• The US economy added 661K new jobs in September and the unemployment rate fell to 7.9%.
• The prevalent risk-off mood might extend some support and help limit any meaningful slide.

Gold extended its sideways consolidative price action through the early North American session and remained confined in a range, above the $1900 mark post-NFP.

The precious metal reversed an early dip to the $1890 region and shot to 1-1/2-week tops on the back of reports that the US President Donald Trump was tested positive for the highly contagious COVID-19. The unexpected news took its toll on the global risk sentiment and forced investors to take refuge in traditional safe-haven assets, including gold.

The anti-risk flow was further reinforced by a weaker tone surrounding the US Treasury bond yields, which extended some additional support to the non-yielding yellow metal. The uptick, however, lacked any strong bullish conviction. A modest pickup in the US dollar demand was seen as one of the key factors capping gains for the dollar-denominated commodity.

The greenback gains some traction following the release of the latest US monthly jobs report, which showed that the unemployment rate fell more than expected to 7.9% from 8.4% previous. Meanwhile, the headline NFP print missed market expectations and came in 661K. The disappointment, however, was negated by an upward revision of the previous month’s reading.

Meanwhile, a White House spokesperson noted that Trump was not incapacitated and was working from his residence. Separately, the New York Times’ Maggie Haberman reported that Trump is showing mild, cold-like symptoms, albeit did little to improve the market sentiment. The risk-off mood should continue to underpin the XAU/USD and help limit any deeper losses.

Technical levels to watch