GOLD rises but limited by EMA21, pay attention to ADP and NFP

Updated

The US manufacturing industry lost more momentum and increasingly fell into a state of contraction. This data led to an increase in interest rate cut expectations, the US Dollar and US Treasury bond yields fell, and the gold market regained momentum and remained around 2,350 USD/ounce.

On Monday, the Institute for Supply Management (ISM) announced that the US manufacturing index fell to 48.7% in May, down from 49.2% in April. The data was weaker than expected, with consensus predicting the index will improve slightly to 49.8.

The gold market has seen some initial buying momentum as it recovers from lows, disappointing economic data has created fresh buying in the market.
Markets increasingly expect that the slowing economy will force the Federal Reserve to cut interest rates, even as inflation remains relatively high, higher than the Fed's target of level 2 inflation. %.
The market expects an 82% chance that the Fed will cut interest rates in November. Meanwhile, the European Central Bank will almost certainly cut interest rates by 0.25% to 3.75% on Thursday, likely potentially become the first major central bank to cut interest rates this cycle.

Investors are now looking forward to the ADP jobs report on Wednesday and US nonfarm payrolls data on Friday.

Published weekly, PCE cools down but does not yet support GOLD

Analysis of technical prospects for XAUUSD
On the daily chart, gold recovered again and maintained price activity above the 0.236% Fibonacci retracement level, which can be considered a positive signal. However, the recovery momentum is also limited by the 21-day moving average (EMA21).

As noted to readers in previous publications, in order for the gold price to have more basis for its rising prospects, it needs to bring price activity above EMA21, then the short-term target level is noticed. at original price of 2,400 USD.

Temporarily, at the present time, the gold price is not yet qualified to increase in price, but on the other hand, the short-term technical trend is more inclined towards the possibility of price decrease. And notable technical points will be listed as follows.
Support: 2,340 – 2,324USD
Resistance: 2,353USD

🪙SELL XAUUSD | 2376 - 2374

⚰️SL: 2380

⬆️TP1: 2369
⬆️TP2: 2364

🪙BUY XAUUSD | 2324 - 2326

⚰️SL: 2320

⬆️TP1: 2331
⬆️TP2: 2336

Trade closed: target reached

Plan BUY Close Full Hit TP2 + 120pips 🗡

Note

- DXY retested the 105.00 resistance level and could not sustain above this level. The index fell to 104.00.
- If DXY closes below the 104.00 support, the index could return to around 103.00.
- Conversely, DXY could stay in the 104.00-105.00 zone if the index remains above the 104.00 support level.

Note

🟢Treasury yields rise as investors weigh economic data

➡️U.S. Treasury yields were higher on Wednesday as investors considered the state of the economy amid a series of key data releases.

Note

This will mark the official end to the cycle of record rapid growth that began after the Covid-19 pandemic when inflation soared. However, investors' attention seems to have turned to what happens after the ECB's June interest rate cut.

Note

Inflation reached 2% one quarter later than in March.

Note

According to the Fed's statement on Thursday, the hypothetical scenario in the test simulates a severe global recession, stressing the residential and commercial real estate markets.

Note

🔴Gold extends decline after US Nonfarm Payrolls beats expectations

Gold (XAU/USD) falls all the way back to the $2,294s on Friday after the release of US Nonfarm Payrolls (NFP) data shows the US economy added 272K jobs in May when 185K had been expected. The result was also higher than the April figure which was revised down to 165K.
The US Bureau of Statistics (BLS) report showed a rise in Average Hourly Earnings of 4.1% YoY from a revised-up 4.0% in April, and beat estimates of 3.9%. The Unemployment Rate rose to 4.0%, however, when 3.9% had been forecast from 3.9% previously.

Note

🔻Gold price deflates after People’s Bank of China halts further buying
Gold is trending lower at the end of the week after the news that Gold reserves at the PBoC remained unchanged at 72.8 million troy ounces at the end of May, the exact same figure as at the end of April, according to official data from the PBoC on Friday.

🔻The data follows strong buying in April that saw China Gold reserves at the PBoC hit an all-time high, accounting for 4.9% of total reserves, and following 18 consecutive months of growth.

Note

The world gold market last week continuously received important data, causing prices to continuously reverse. Notably, on the last trading day of the week, the market suffered two shocks that caused prices to continuously "plunge".

In just 1 day, gold lost more than 3.5%, marking the largest intraday sell-off since 2020. In the current context, most analysts believe that gold prices are likely to test this level. support 2,200 USD/ounce.

Note

🔹Bond traders are tilting dovish again, piling into wagers that would benefit from a faster pace of Fed interest rate cuts.

Note

World gold prices recovered slightly at the start of the morning trading session earlier this week (June 10), after the strongest sell-off in more than 2 years last Friday. Analysts believe that the prospect of gold price increases is still bright in the long term, but the price of this precious metal may continue to fluctuate strongly in the short term.

Note

- XAUUSD has remained in the range of 2,300-2,400 USD per troy ounce since mid-May. Price has fluctuated slightly. However, the price approached $2,400 per troy ounce but failed to test this level and fell below $2,300 per troy ounce.
- If XAUUSD falls further, the price could retest the range of 2,200-2,230 USD per troy ounce.
- Conversely, XAUUSD could return to $2,310-2,335 per troy ounce if the price retraces before extending the decline.

Note

🟥Treasury yields rise as investors look to Fed meeting, inflation data

U.S. Treasury yields were higher on Monday as investors looked ahead to the Federal Reserve’s monetary policy meeting and key inflation data due this week.

Note

🟢Al Jazeera correspondent: Continuing clashes between the Palestinian resistance and the occupation forces penetrating the center of the city of Rafah.

Note

Labor market data reflect mixed signals, but taken together, they show a picture of a US economy in relatively healthy shape. This is something to celebrate, no matter how much people say "good news is bad news in terms of interest rates".

Xayah_trading

🔰| Forex trading

🧩Get an average of 1200 pips per month
🧩Consulting on Risk Management
🧩Account management
🧩Forex signals have a high win rate

🚨🚨🚨FREE SIGNALS: t.me/+8q3AxDD9CsRjYzI1

Also on:

Related publications

Disclaimer

The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.