Gold Rally Fizzles Out After Strong US Jobs Data Ignites Risk Appetite

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The Gold price (XAU/USD) initially surged on Friday after weaker-than-expected Nonfarm Payrolls data, but then gave up all its gains and ended the day lower.

  • Initial Rally on Lower Job Growth: Gold jumped on the NFP report showing a miss on job creation expectations, potentially indicating less pressure on the Fed to raise rates.
  • Market Optimism Leads to Gold Price Decline: The overall positive market sentiment and a rally in US stocks weighed on the safe-haven demand for Gold.
  • Technical Analysis: Uncertain Direction: The Measured Move pattern completion is unclear, leaving potential for either upside or downside.

Key Points from NFP Report:

  • Job growth (175K) fell short of analysts’ estimates (243K).
  • Average Hourly Earnings growth slowed, suggesting easing inflation pressures.

Impact on US Dollar and Gold:

  • A weaker USD due to potential future Fed rate cuts could have supported Gold.
  • However, the risk-on environment dampened the demand for safe-haven assets like Gold.

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