Following several volatile sessions, gold prices are now trading at around $4,400 per troy ounce, with strong US labor market statistics being the key source of pressure. In August, the American economy added 162,000 jobs, significantly surpassing analysts’ expectations, while unemployment held steady at 4.1%. This release lifted the probability of a September rate hike by the Federal Reserve (Fed) to nearly 60%, pushing 2-year Treasury yields up to 4.38% and driving a modest rise in the dollar index (DXY). As a result, the precious metal plunged by over 2% on Friday.
The fundamental picture remains mixed, with several tailwinds still in play. Just a few days earlier, on September 3, gold gained more than 2% on declining expectations of a Fed hike, underscoring the metal's high sensitivity to shifts in the US regulator’s monetary trajectory. Market focus now turns to upcoming inflation data: the Consumer Price Index (CPI) and the Producer Price Index (PPI). Weaker readings could temper hawkish projections, weigh on US bond yields, and underpin bullion’s recovery.
From a technical perspective, gold continues to move within the flat range of $4,280–$4,700 per troy ounce. A recent drop resulted in a successful test of the channel’s bottom boundary near $4,280, where buyers stepped in and helped prices rebound—confirming this level as strong support. Given the current technical picture and renewed momentum from bulls, we can expect a move toward the upper limit of the range—resistance at $4,700.
The final recommendation:
— Buy gold at the current price of $4,400, aiming for $4,700 within a week.
— Place a Stop Loss order at $4,280 to manage risks if the market plays against us.
This content is for informational purposes only and is not intended to be investing advice.
