Global Gold Extends Weekly Gains for the Third Consecutive Week
Updated
Global gold has been extending its gains for the third consecutive week, with the pace of gains accelerating each week. It has broken past historical ceilings and is attempting to set a new post-December 2023 high. Recent Federal Reserve messaging and a string of strong economic data releases have significantly contributed to the rally.
Last week, a much sharper than expected contraction in the ISM's Non-Manufacturing PMI index kicked off gold's advance early in the week. Later, despite Fed Chair Powell's emphasis on patience and prudence regarding inflation outlook in his semi-annual Congressional testimony, he signaled that the Fed will "certainly" cut rates by the end of the year and that he's not necessarily aiming for inflation to hit 2% before commencing rate cuts. This less hawkish tone from the Fed Chair caused a sharp drop in Treasury yields and the dollar, pushing stocks back to higher levels and gold to new highs.
Markets are now holding their breath awaiting Friday's release of the US jobs report (NFP) and wage growth figures for February to see if they deliver another surprise, as January's did. NFP employment is expected to rise 198k after a 353k gain in January. While other data points to a possible return to January's strong number, such an outcome would require cautious interpretation given recent NFP volatility. Wage growth is seen slowing to 0.2% from the prior period's 0.6%.
Global gold's advance is most likely to pause if NFP comes in well above forecasts and hourly wage growth is warmer than expected. Technically, 2170-2193 now serves as gold's potential short-term ceiling. Within this range, gold can see a minimum correction to 2150. As long as it holds above 2150, any dip offers an opportunity to retest 2193. A break above 2193 targets the next resistance at 2248.57. However, consolidation below 2150 could see corrections targeting 2127, 2108 and 2083.
Last week, a much sharper than expected contraction in the ISM's Non-Manufacturing PMI index kicked off gold's advance early in the week. Later, despite Fed Chair Powell's emphasis on patience and prudence regarding inflation outlook in his semi-annual Congressional testimony, he signaled that the Fed will "certainly" cut rates by the end of the year and that he's not necessarily aiming for inflation to hit 2% before commencing rate cuts. This less hawkish tone from the Fed Chair caused a sharp drop in Treasury yields and the dollar, pushing stocks back to higher levels and gold to new highs.
Markets are now holding their breath awaiting Friday's release of the US jobs report (NFP) and wage growth figures for February to see if they deliver another surprise, as January's did. NFP employment is expected to rise 198k after a 353k gain in January. While other data points to a possible return to January's strong number, such an outcome would require cautious interpretation given recent NFP volatility. Wage growth is seen slowing to 0.2% from the prior period's 0.6%.
Global gold's advance is most likely to pause if NFP comes in well above forecasts and hourly wage growth is warmer than expected. Technically, 2170-2193 now serves as gold's potential short-term ceiling. Within this range, gold can see a minimum correction to 2150. As long as it holds above 2150, any dip offers an opportunity to retest 2193. A break above 2193 targets the next resistance at 2248.57. However, consolidation below 2150 could see corrections targeting 2127, 2108 and 2083.
Comment
Sell at 2193 activated!Comment
Gold is still within the resistance range! It doesn't have the strength to break through this range unless today's news helps it.You can either close the deal in profit or risk-free. 😉
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