Gold drops to immediate support-line as traders prefer USD on NFP day
- Risk tone largely confined ahead of the key US data.
- Short-term support limits the downside near current month high.
With the market sentiment in favor of the US Dollar (USD), gold prices tick down to short-term support-line near $1333 ahead of the European open on Friday.
The reason could be the latest upbeat comments from the New York Fed President John Williams ahead of the key employment data for May month.
Despite expectations suggesting the headline nonfarm payrolls (NFP) figures to be a bit down to 185K from 263K prior, traders kept supported the greenback.
In case of politics, the White House talks to avoid Mexican tariffs failed while the US President Donald Trump kept tweeting in favor of the Fed’s rate cut while highlighting strong position compared to Mexico in terms of trade.
On the other hand, China’s central bank Governor praised the nation’s ability to cope up with the US-led trade protectionism ignoring short-term draw on the economy.
Risk sentiment remained largely unaffected of the latest news as investors await important statistics from the US. The global risk barometer 10-year US treasury yield holds 2.122% mark during press time.
In addition to labor data, that expects no change in the unemployment rate and average hourly earnings, political plays surrounding the Mexican tariffs and trade tussle with China could also become important to watch.
Technical Analysis
On a sustained break below $1333, $1328 and $1311 can come back to the chart whereas $1347 and $1356/57 seem to limit the bullion’s medium-term upside.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
