The US nonfarm payrolls report came out. Investors interrupted this data differently, but gold was under selling pressure after its release.
Comex gold future for July delivery was down by 2.04% to be traded at $1,386.90 while gold futures for August delivery was down by $34.60 to be traded at $1,381. Gold in the spot market was also down by 1.98% to be traded at $1,385.70. Gold price in the London AM fix was at $1,410 today, and it was $1,400 in the previous PM fix.
The US nonfarm payrolls report came out higher than expected by 5,000 at 175,000 in May. The unemployment rate in the US rose to 7.6% from 7.5% last month, indicating more people entered the labor force. The reason behind the sharp eye on this report is it might shadows the Feds next step in the quantitative easing program. Still, the numbers didn’t reach the 200,000 jobs per month average forecasted to reduce the pace of asset purchases. This means the QE would continue for a while without slowing the pace of bond purchasing.
The USD and US stock indices benefited from this news, in turn, putting pressure on gold. The USD index gained on the slightly better than expected US payrolls. The US major stock indices, Dow Jones, Nasdaq, and S&P 500, gained an average of 0.97%. These gains in the stock markets and firmer USD put a selling pressure on gold.
On the technical side, the bears need to push lower than $1,372.80 last week’s low. The bulls need to break the physiologically solid technical resistance at $1,450. The current technical resistance is at $1,423.30 then $1,430. Gold price technical support is currently at $1,380.