Gold has been one of the major in-play asset classes in recent weeks as a dovish Fed and global worries keep a bid under the yellow metal.
Today, GOLD will again be a key focus as the latest US jobs number is released. The monthly report takes on an entirely new level of importance because of the high likelihood that the FOMC will cut rates at the next meeting.
That will likely see Gold remain strong for the time being, but we could see even more action today if there is a particularly weak jobs number. The ADP number out earlier in the week already missed expectations and this could give us a bit of an indication of what is to come.
Key Technical Levels
As price has broken through the 1400 level and held on the first test, that to me becomes the benchmark. I will predominately be looking for long positions above that level. Remember that commodities trend as a general rule and while the trend is up that is the higher probability play.
1410-11, is really the swing low here at the moment. I would want to see buying at that level to confirm the thesis. Earlier today price did push up towards the next level which is 1420, but it couldn’t hold. I wouldn’t expect a strong move ahead of the jobs number anyhow.
Clearly, the highs are the major focal point today. A break of 1440, could open the door to another push higher. There will be some work to get through this point as we have put in what appears to be a bit of a double top as it is.
Bottom line: I would be looking to buy a pullback at a support level below, or waiting for a break of the 1440 level. If price drops 1400, then I would give the long thesis away for now.