Gold struggles to stretch higher above $1,500 on renewed trade optimism
|- Trump says they have a good chance of making a deal with China.
- US Dollar Index remains on track to finish the week below 99.
- Wall Street's main indexes post strong gains on Friday.
After spending the majority of the day moving sideways in a tight channel above the $1,500 mark on Friday, the XAU/USD pair fluctuated sharply during the early trading hours as markets reacted to the labour market data from the United States (US).
Following a spike to a daily high of $1514, the pair dropped all the way down to $1,495 before staging a modest recovery. As of writing, the pair was trading at $1,503, losing nearly $2 on a daily basis. On the weekly chart, the pair remains on track to close in the positive territory.
Earlier today, the US Bureau of Labor Statistics announced that nonfarm payrolls (NFP) rose 136,000 in September to miss the analysts' estimate for an increase of 145,000. However, the unemployment rate dropped to its lowest level in nearly 50 years at 3.5% and allowed the Greenback to limits its losses. In fact, the US Dollar Index, which tracks the dollar's value against a basket of six major currencies, was last flat on the day at 98.90.
Risk-on flows return on latest trade headlines
On the other hand, heightened hopes of the US and China making progress in next week's trade talks made it difficult for traditional safe-haven assets to find demand in the second half of the day on Friday.
US President Donald Trump said that he saw a "very good chance" of a trade deal with China and White House economic adviser Larry Kudlow said that there could be some positive surprises coming out of next week's negotiations. Reflecting the upbeat sentiment, Wall Street's main indexes opened in the positive territory and continue to push higher with both the Nasdaq Composite and the S&P 500 adding around 1% on the day.
Technical levels to watch for
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.