By Dr. Renisha Chainani, Head- Research, Augmont – Gold for all
The gold market got off to a strong start this week, with the precious metal reaching a record high of $2150 on Monday. The wider market, on the other hand, did not believe the rise and put gold back towards $2000/oz on Friday after NFP data.
The recent US job report, which showed that the labour market is improving in contrast to recent statistics released earlier in the week, sparked the slide in precious metals. According to the US Bureau of Labor Statistics, the economy added 199K jobs, beating predictions of 180K, while the unemployment rate fell from 3.9% to 3.7%.
US payrolls report mitigates concerns that the US labour market is losing steam, fueling speculation about a dovish shift in the Fed’s monetary policy outlook. The CME Group’s FedWatch Tool predicts that the Fed will remain unchanged at its meeting next week, but bets on a rate drop in March have dipped below 50%.
International Gold Weekly Chart
From the technical perspective, Gold was unable to sustain above the Triple top resistance of $2080 this week and created an Engulfing bearish candlestick chart pattern this week. If prices sustain below $2000, the next targets would be $1970 and $1950 in the short term. On the upside, resistance remains at $2040 and $2080.
International Silver weekly chart
Silver has created Triple-top resistance at $26.3 and Engulfed a bearish candlestick chart pattern, erasing two weeks of gains this week. This downside rally is expected towards $22 with a resistance of $24 in the short term.
The Fed and ECB will deliver an update on monetary policy as well as their most recent projections in the next week. There is plenty of additional high-impact data available, such as US CPI and UK job figures, which might contribute to a tumultuous trading environment.
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