- By the end of last week's trading, gold futures recorded tepid gains, recording a modest weekly increase.
- Investors watched the July jobs report, which divided Wall Street over whether the Fed will continue to tighten monetary policy after the latest employment data.
- The question now: Can the gold price return to $2,000 an ounce this month?
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According to the trading, the gold price rose to the level of 1947 dollars an ounce, rebounding from strong losses that pushed it towards the support level of $1925, which is closest to testing the psychological support level of $1900. All in all, the gold price got a weekly jump of 0.8%, which adds to its gains since the beginning of the year 2023 to date by about 8%. In the same performance, silver prices, the sister commodity to gold, remained below $ 24. Silver futures fell to $23.67 an ounce. All in all, the price of the white metal fell by 3.29% last week, which sent silver prices to the 2023 year-to-date performance of -2%.
In general, everything was influenced by the latest US jobs numbers.
According to the Bureau of Labor Statistics (BLS), the US economy added a total of 187,000 new jobs in July, up from a revised 185,000 in June. Economists have projected 200,000 new jobs. The country's unemployment rate fell to 3.5%, while the labor force participation rate was unchanged at 62.6%. Average hourly earnings were unchanged at 0.4% month over month and 4.4% year over year, for a total of $33.74 per hour. The average weekly hours decreased to 34.3. All in all, the latest US jobs numbers have investors debating whether this will support a rate hike at the Federal Open Market Committee (FOMC) meeting in September. Meanwhile, financial market indices posted gains.
Meanwhile, US Treasury yields declined, with the benchmark 10-year yield dropping 10.3 basis points to 4.086%. The two-year note yield fell 7.8 basis points to 4.818%, while the 30-year note fell 7.5 basis points to 4.23%. Gold is usually sensitive to movements in interest rates because they can affect the opportunity cost of holding non-yielding bullion.
And a strong factor affecting the gold market. The US Dollar Index (DXY), a measure of the greenback against a basket of major currencies, fell to 101.83, from an opening of 102.54. Overall, the DXY is on track for a weekly loss of 0.2%, in addition to its year-to-date decline of 1.6%.
A weaker price is beneficial for dollar-denominated commodities because it makes them cheaper for foreign investors to buy.
Relative to other metals markets, copper futures fell to $3,861 a pound. September palladium and platinum futures remained unchanged at $937.00 and $1236.00 an ounce, respectively.
Gold Technical Analysis
Gold price remains a few levels below the 100 hourly moving average line. As a result, the yellow metal price continues to trade centered on the 14-hour RSI. According to the performance in the near term, it appears that the gold price is trading within a sideways channel formation. This indicates that there is no clear short-term directional bias in market sentiment.
Therefore, the bears will target the potential bearish breakout at around $1.923 or lower at $1.913 an ounce. On the other hand, the bulls - the bulls - will look to take profits around $1942 or higher at $1955 an ounce.
In the long term and according to the performance on the daily chart, it appears that the gold price XAU / USD is trading within a bearish channel formation. This indicates a significant long-term bearish bias in market sentiment. Therefore, the bears will be looking to extend the current range of declines towards $1892 or lower to $1852 an ounce. On the other hand, the bulls - the bulls - will look to pounce on profits at around $1,980 or higher at $2,025 an ounce.
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