Gold price, the yellow player. In a sudden movement for gold price. It drooped down by $30 to reach the level of $1382.80 USD/Ounce of gold, to decline by 2.19% it was unexpected movement for gold. But why it taked place in the market ?
The only obvious reason for the huge decline of gold price, is the rise of the U.S. Dollar, due to the positive data about the Labor market in USA. In a sudden move from USA on its way of curing its economy, USA released a positive data about its labor market. In which the un agriculture payrolls report came out higher than expected by 5,000 at 175,000 in May. The unemployment rate in USA declined, which is an indicator for the improvement of the US economy, as a result we watch an improvement of the U.S. Dollar which caused for sure a pressure on gold price, leads to its decline sharply today.
It is a bad indicator for gold trader which mean that, we will return to the narrow deliberative range, and this range is between $1380 and 1410 USD/Ounce of gold, this trend is so narrow, and had a lot of troubles during trading because of the number of investors, who can dominate over this range to gain profits, also it will harm the small investors in Gold.
USA follow a plan to end the assets purchase soon, and one of the way to end the program, is to increase the efficiency of the labor market. But it had a negative impact on gold price that is what we face now. USA working on the plan and the U.S Dollar value increase, the issue which push over gold price. It also but gold price in a narrow trading range. The only way to get out of this range, is a deficit in the US economy, it is the only way for the rise of gold price and to get out of this narrow trading range.