The Price of Gold Levels to Watch Ahead of the us Non-Farm payrolls (NFP) Report

The Price Of Gold, ” Talking Points

The price of gold struggles to maintain the advance from earlier this week, ahead of the us Non-Farm payrolls (NFP) report, but the precious metal may stage another attempt to test the 2012 high ($1796) as the Relative Strength Index (RSI) breaks out of a negative slope.

The Price of Gold Levels to Watch Ahead of the us Non-Farm payrolls (NFP) Report

The price of gold has traded to fresh yearly highs during each month of the year 2020, and the precious metal may continue to present the characteristics of a behavior to the upside in June, as the decline of the high annual ($1765) reverses before the September low ($1670).

However, the cost of update for the U.S. NFP report may shake up the short-term outlook for the bullion as employment is expected to decrease from 4.25 M in May, following the 20.5 M contraction the month before, and it remains to be seen if the data will influence the monetary policy outlook as the Federal Reserve prepares-to-have-the – The primary Liquidity Facility, along the Main Street Loan Program to be operational in June.

The new series of unconventional measures, could ultimately push the Federal Open Market Committee (FOMC), at margin of fence, to climb above $7 billion in September, the central bank may carry a wait-and-see over the next few months, as President of theJerome Powelltames the speculation for a a negative interest rate policy (IT).

In turn, the FOMC may just be trying to save time, at its next interest rate decision on 10 June, as The federal reserve officials are express mixed views on the U.S. economy, but the committee may continue to endorse a dovish forward guidance from the central bank remains committed to the “with its complete range of tools to support the U. s. economy in these difficult times.”

That said, the the low interest rate environment, the long balloon the central bank balance sheets can continue to act as a safety net for the goldas the marketparticipants searched for an alternative to the fiat currencies, and the precious metal may stage another attempt to test the 2012 high ($1796) as the Relative Strength Index (RSI) breaks out of a bearish formation.

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Gold Price-Daily Chart

Source: The Negotiation Of The View

• The opening of the range at the horizon 2020, it instilled a constructive outlook for gold prices, the precious metal is seeing the 2019 is the high ($1557), with the Relative Strength Index (RSI) pushing into overbought territory during the same period.
• A similar scenario was solidified in February, with the price of gold is resistant to the monthly low ($1548) during the first full week, while the RSI broke out of the bearish formation from earlier this year to push back into overbought territory.
• However, with the monthly opening range of This axis is less and less relevant in the middle of the upswing in volatility, with the decline from the monthly high ($1704) leads to a break of the January low ($1517).
• Nevertheless, the reaction of the old area of resistance at around us $1450 (38.2% retracement) to $1452 (100% real) has instilled a constructive outlook for the bullion as far as the RSI changed course to advance into oversold territory, and broke out of the bearish formation from November.
• In its turn, had been erased from the March high ($1704) to the tag to a new annual high ($1748), in April, with the upward trend of behavior, also taking shape in May, as the precious metal traded at a fresh 2020 ” high ($1765).
• The upward trend of behavior that can persist in June, as the price of gold is reversing before the September low ($1670)with the RSI, highlighting a dynamics similar as an indicator out of the a negative slope compared to the previous month.
• Need a close above the Fibonacci overlap of approximately $1733 (78.6% retracement) to $1743 (23.6% expansion) to open the $1754 (261.8% expansion) of the region, with the next area of interest should be around $1786 (38.2% expansion), followed by the 2012 high ($1796).

— Written by David Song, Currency Strategist

Follow me on Twitter at @DavidJSong