Gold Price Prediction – Prices Rebound Following Payroll Report Miss
Gold prices rallied on Friday, reversing Thursday’s slide. The weaker than expected U.S. employment report offset, the better than expected ADP private payroll number that was announced Thursday. The dollar reversed its upward movement putting upward pressure on the yellow metal. U.S. yields declined and have started to break down, which help buoy gold and weigh on the greenback.
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Technical analysis
Gold prices rose sharply. The uptrend is still in place as the 10-day moving average recently crossed above the 200-day moving average.Target resistance is seen near the 10-day moving average at 1,895. Short-term momentum is reversing after turning negative as the fast stochastic generated a crossover sell signal, and is poised to generate a crossover buy signal. Medium-term momentum has turned negative MACD (moving average convergence divergence) as the MACD (moving average convergence divergence) index generated a crossover sell signal.
Employment was Softer than Expected
Job creation disappointed again in May, as nonfarm payrolls rose 559,000 but still short of lofty expectations, of 671,000. The government report followed Thursday’s private payroll report which showed a larger than expected gain.The unemployment rate fell to 5.8% from 6.1%, which was better than the estimate of 5.9%. An alternative measure of unemployment that includes discouraged workers edged lower to 10.2%.