Gold Price Analysis: XAU/USD jumps to upper $1870s, probes multi-week highs ahead of Friday’s NFP release
02.06.2022, 14:58

Gold Price Analysis: XAU/USD jumps to upper $1870s, probes multi-week highs ahead of Friday’s NFP release

  • Gold prices rallied over 1.0% into the upper $1870 and towards multi-week highs on Thursday as the buck/US yields softened.
  • But any bullish breakout towards $1900 will probably have to wait until after Friday’s official US jobs report.

Spot gold (XAU/USD) prices rallied more than 1.0% on Thursday from the low $1840s per troy ounce to the upper $1860s and are currently probing late May highs just under $1870. An upside break would open the door, technically speaking to a run higher towards the 50-Day Moving Average, which is close to the $1900 level.

Thursday’s gains come as US yields and the US dollar back off from weekly highs, giving precious metals markets some tailwinds, and despite mixed tier two US labour market data (Q1 Unit Labour Cost was revised higher, May ADP Employment Change missed expectations and weekly jobless claims was decent). But any bullish breakout will likely have to wait until after Friday’s official US jobs report.

Gold bulls should beware of the risk that the report comes in stronger than expected and/or shows a further acceleration of US wage pressures. In this scenario, markets would likely rush to price in a more hawkish Fed policy path, which could push yields and the buck higher and weigh on gold. For now, Gold will probably remain rangebound in the mid-$1800s.

 

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