The gold price is bouncing in a small range around $2,050.00 ahead of the announcement of the US NFP.
The gold price (XAUUSD) is fluctuating about $2,050.00 in the early Asian session. The precious metal is trying to find a direction as investors await the publication of official employment statistics from the United States.
The US Automatic Data Processing (ADP) agency reported 296K new payrolls on Wednesday, compared to predictions of 150K and the previous reporting of 145K. While the preliminary US Nonfarm Payrolls report shows 179K job additions in April, this is lower than the previous month’s additions of 236K. The unemployment rate is expected to remain unchanged at 3.5%.
Households having more money to spend as a result of better salaries would drive up US inflation.
The Average Hourly Earnings report is an economic indicator that might spark a power-pack activity in the US Dollar. The economic data is considered as stable, but it might have several ramifications Inflation in the United States.
The preliminary Unit Labor Costs for the first quarter jumped dramatically to 6.3% on Thursday, above predictions of 5.5% and the previous release of 3.3%. Households with high disposable income would fuel inflationary pressures and may cause the Federal Reserve (Fed) to seek data-dependent information supportive of a hawkish policy.
The drop in PacWest Bancorp shares as it evaluated strategic options for a potential sale fueled worries of a US banking disaster.
Despite rising fears of a US banking crisis, the US Dollar Index (DXY) has extended its recovery to near 101.45. The drop in PacWest Bancorp shares as it evaluated strategic options for a potential sale reignited worries of a US financial meltdown caused by the Fed’s rising interest rates.
Gold Technical Outlook
On an hourly basis, gold fell considerably after reaching a new all-time high of $2,079.76. Following a strong one-sided auction, the precious metal is showing signs of volatility contraction. The upward-sloping trendline drawn from the March 03 low of $2,007.39 is giving support for gold bulls.
The advancing 20- and 50-period Exponential Moving Averages (EMAs) at $2,045.81 and $2,034.02, respectively, imply a strong upward bias.
Meanwhile, the Relative Strength Index (RSI) (14) remains in the bullish range of 60.00-80.00, indicating that the upward momentum has not yet faded.
