At the end of the Asian market on Friday (December 8th), spot gold slightly declined in the short term, with gold prices just falling below the $2030/ounce mark, almost giving up on the intraday rebound. FXTree analyst Mat í as Salord's latest article analyzes the prospects of gold technology.
Salord pointed out that although the yield of US treasury bond bonds declined, gold still faced bearish pressure. Gold prices face strong resistance at $2040 per ounce.
The sharp decline in gold prices from historical highs has caused damage, and the wounds are still clearly visible. However, the positive side is that gold prices have avoided further declines so far, indicating that consolidation may continue. In terms of fundamentals, the sideways trend reflects the market's belief that the Federal Reserve will not raise interest rates, and it is expected that the Federal Reserve will cut interest rates in 2024. This may be unfavorable for the US dollar, but considering US GDP growth and prospects, the fundamentals of the US dollar remain one of the strongest currencies among G10 currencies.
Salord said that for gold to resume its upward trend, the US dollar seems to need to weaken moderately. In addition, US Treasury yields should continue to move away from any significant rebound. In this context, gold prices should return to near historical highs at some point in time.
The data released by the United States on Thursday was mixed, with the highlight being a significant decline in the number of people applying for unemployment benefits after soaring last week. The focus now shifts to Friday's non farm employment data, which is expected to increase by 180000 people. Next week, investors will welcome the Federal Open Market Committee (FOMC) meeting, followed by the release of the US Consumer Price Index (CPI) next Tuesday.
At 21:30 Hong Kong time on Friday, investors will receive the US November non farm payroll report. According to authoritative media surveys, the non farm employment population in the United States is expected to increase by 180000 after the November quarterly adjustment, compared to an increase of 150000 in October. The US unemployment rate is expected to remain at 3.9% in November.
Investors will also pay attention to salary data. A survey shows that the average hourly wage rate in the United States is expected to increase by 0.3% per month and 4.0% per year in November.
Short term technical prospects for gold
Salord stated that gold prices continue to fluctuate around $2025 per ounce and still face some bearish pressure after a significant drop from record highs. The strong support area for gold prices appeared at $2020/ounce and $2010/ounce. According to the gold daily chart, the trend is upward, and gold prices are still above the key simple moving average.
Salord added that in the short term, according to the gold 4-hour chart, technical indicators are starting to stabilize, providing signs of support for gold prices. The technical indicators tend to flatten near the midline without any obvious tendency. On the upward side, the short-term resistance level for gold prices is at $2040 per ounce. If it breaks through this level, it may lead to a gold price test of $2050 per ounce. On the downside, in order for gold to recover its decline, it needs to decline and remain below $2020 per ounce.
Salord provides the latest key support and resistance levels for gold prices:
Support level: 2020 USD/oz; 2010 USD/oz; 1990 USD/oz
Resistance level: $2040/ounce; $2055 per ounce; $2072 per ounce
