Taking a look at the US Labor report there is a chance that gold can recover its recent losses if we see a big miss in the report. Remember that the Fed sees the labor market through an inflationary or deflationary lens. If the labor market is strong, that is seen as inflationary. If the labor market is weak, that is seen as deflationary.
The inflation picture (being higher) has been driving yields and the USD higher recently ever since the Fed had a higher for longer rate narrative. So on Friday here is what to look for.
If the US non-farm payroll comes in below 90,000 and the unemployment rate comes in above 3.9% then watch for significant gold upside. The market wants to find a reason for the recent surge in yields and the dollar to pullback. A weak jobs report would be just the reason.
From an event bias, gold tends to gain out of the US labor report with an average return of nearly 0.5% in the 4 days after the report. So, with gold having sold off heavily on the higher rates for a longer narrative would a weak jobs report give the catalyst that gold needs for a sharp retracement higher?
Major Trade Risks: The major trade risk here is that the US jobs print comes in strong.
Disclaimer: Past results and past seasonal patterns are no indication of future performance, in particular, future market trends. seasonax GmbH neither recommends nor approves of any particular ...
Disclaimer: Past results and past seasonal patterns are no indication of future performance, in particular, future market trends. seasonax GmbH neither recommends nor approves of any particular financial instrument, group of securities, segment of industry, analysis interval or any particular idea, approach, strategy or attitude nor provides consulting nor brokerage nor asset management services. seasonax GmbH hereby excludes any explicit or implied trading recommendation, in particular, any promise, implication or guarantee that profits are earned and losses excluded, provided, however, that in case of doubt, these terms shall be interpreted in abroad sense. Any information provided by seasonax GmbH or on this website or any other kind of data media shall not be construed as any kind of guarantee, warranty or representation, in particular as set forth in a prospectus. Any user is solely responsible for the results or the trading strategy that is created, developed or applied. Indicators, trading strategies and functions provided by seasonax GmbH or on this website or any other kind of data media may contain logical or other errors leading to unexpected results, faulty trading signals and/or substantial losses. seasonax GmbH neither warrants nor guarantees the accuracy, completeness, quality, adequacy or content of the information provided by it or on this website or any other kind of data media. Any user is obligated to comply with any applicable capital market rules of the applicable jurisdiction. All published content and images on this website or any other kind of data media are protected by copyright. Any duplication, processing, distribution or any form of utilisation beyond the scope of copyright law shall require the prior written consent of the author or authors in question. Futures and forex trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones’ financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results. Testimonials appearing on this website may not be representative of other clients or customers and is not a guarantee of future performance or success.
