International gold prices rose slightly, bears must be alert to this signal
On Friday (January 6), the international gold price rose slightly, and it is expected to rise for the third consecutive week. Investors are waiting for the U.S. non-agricultural employment report to be released at 21:30 Beijing time, in order to judge the Fed’s future rate hike path.
At 15:10 Beijing time, spot gold rose 0.40% to $1,839.70 an ounce; the main COMEX gold futures contract rose 0.20% to $1,844.2 an ounce; the U.S. dollar index rose 0.08% to 105.218.
Data released on Thursday (January 5) showed that U.S. private employment increased more than expected in December, while the number of Americans filing new claims for unemployment benefits fell to a three-month low last week, indicating that the labor market remains tight and may force the Federal Reserve to continue to increase As a result, the price of gold fell by more than 1% as a result of interest rates and maintaining a higher level of interest rates for a longer period of time.
IG Market strategist Yeap Jun Rong said: “Higher-than-expected job growth and longer-lasting wage pressures could be catalysts adding to selling pressure on gold. Gold prices have been trending higher since November last year as dollar bulls unwind their positions. To In 2023, the gold price may continue to attract buyers, but it may face the risk of a strong pushback from policymakers.”
But the minutes of the Federal Reserve’s December policy meeting were released on Wednesday (January 4), and few Fed officials reiterated their continued struggle to reduce inflation to 2%, although St. There will be some relief.
“Gold is likely to remain above $1,800 an ounce until that happens, with labor market weakness looming,” Edward Moya, senior analyst at OANDA, said in a note.
The Federal Reserve cut its rate hike to 50 basis points in December and is expected to slow the pace of rate hikes further, which has put pressure on U.S. Treasury yields and may provide some price support for non-yielding gold. It is worth recalling that Fed officials previously agreed that the central bank should slow down the pace of rate hikes. Gold bears should remain cautious.
Gold looks set for a pullback, but losses above the $1,830 area appear to be capped. There is strong support in this area and failure of that support should open up new downside. On the upside, if gold rebounds above $1,850, the price outlook will turn positive again.