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Gold futures are inching lower early Friday, putting the market in a position to post its third straight weekly loss. Pressuring the market are rising Treasury yields and a soaring U.S. Dollar.
Trading is expected to be a little on the light side overnight ahead of the U.S. Non-Farm Payrolls report for April, due to be released at 12:30 GMT.
At 03:00 GMT, June Comex gold futures are trading $1875.10, down $0.60 or -0.03%. On Thursday, the SPDR Gold Shares ETF (GLD) settled at $175.19, down $0.61 or -0.35%.
Investors are looking ahead to the April jobs report, set for release Friday morning. Economists surveyed by Dow Jones expect employers added 400,000 jobs to nonfarm payrolls, down slightly from 431,000 in March. The unemployment rate is expected to fall to 3.5% in April, down from 3.6% in March, according to Dow Jones.
Traders don’t expect this report to have much of an impact on gold prices unless it misses to the downside. If that’s the case then gold prices could firm.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. However, momentum shifted to the upside following Tuesday’s closing price reversal bottom.
A trade through $2003.00 will change the main trend to up. A move through $1849.70 will negate the closing price reversal bottom and signal a resumption of the downtrend.
The minor trend is also down. A trade through the minor tops at $1910.70 and $1921.30 will confirm the shift in momentum.
The minor range is $1849.70 to $1910.70. The market is currently trading on the weak side of its pivot at $1880.20, making it resistance.
The next resistance is a price cluster at $1897.70 to $1908.10, followed by a 50% level at $1932.90.
Daily Swing Chart Technical Forecast
Trader reaction to $1880.20 will likely determine the direction of the June Comex gold market on Friday.
Bearish Scenario
A sustained move under $1880.20 will indicate the presence of sellers. If this creates enough downside momentum then look for a break into the main bottom at $1849.70. Taking out this level could trigger a further break into the February 11 main bottom at $1824.40.
Bullish Scenario
A sustained move over $1880.20 will signal the presence of buyers. This could trigger a surge into $1897.70, followed by a resistance cluster at $1908.10 – $1910.70.
Overtaking $1910.70 will indicate the buying is getting stronger. This could extend the rally into the minor top at $1921.30, followed by a 50% level at $1932.90.
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This article was originally posted on FX Empire