GOLD & CRUDE OIL TALKING POINTS:
- Gold prices[1] break July swing low, clear path below $1200/oz
- Crude oil prices[2] bounce at chart support as risk appetite firms
- US Dollar[3] may rise on jobs data, hurting gold prices further
Crude oil prices returned to the offensive, with the sentiment-linked WTI benchmark rising alongside the bellwether S&P 500[4] stock index. Technology names drove the rally, adding 1.37 percent after the market capitalization of Apple Inc surpassed $1 trillion[5]. Meanwhile, gold prices plunged as the US Dollar accelerated upward, sapping the appeal of anti-fiat alternatives epitomized by the yellow metal.
US JOBS DATA MAY HURT GOLD PRICES FURTHER
Looking ahead, July’s US employment report is on focus. Payrolls growth is expected to come at 193k while the jobless rate ticks down to 3.9 percent and the pace of wage inflation holds steady at 2.7 percent on-year. Outcomes broadly in line with these projections would mark continuation of the business cycle status quo, which this week’s FOMC[6] statement hinted probably means two more rate hikes before year-end.
On balance, this means anything shy of a particularly disappointing showing is likely to be supportive for the US Dollar as traders ponder the widening gap between the US central bank and its G10 counterparts. That seems likely to bode ill for gold. The implications for oil are less clear-cut as the risk-on implications of a healthy labor market compete for influence with a stronger greenback.
Learn what other traders’ gold buy/sell decisions[7] say about the price trend!
GOLD TECHNICAL ANALYSIS
Gold prices
