The precious yellow metal trims some of Friday’s losses on Monday as the US Dollar Index edges lower, after hitting a more than two-month high in the previous session, as a stronger dollar and optimistic comments from U.S. Federal Reserve Chairman Jerome Powell.
The U.S. economy is doing better but is “not out of the woods yet,”
Powell said on Monday, in remarks that flagged an upcoming central bank study documenting the disproportionate blow suffered by the less educated and working parents during the coronavirus downturn.
“The economy is reopening, bringing stronger economic activity and job creation,” Powell said in remarks prepared for delivery at a conference of the National Community Reinvestment Coalition.
“That is the high-level perspective – let’s call it the 30,000-foot view – and from that vantage point, we see improvement. But we should also take a look at what is happening at street level.”
Spot gold bulls quickly stepped in after the remarks.
This Friday, traders will focus on the jobs report from the U.S., which will provide insights into the state of recovery of the labour market.
The Non-Farm Employment Change forecast is seen for a rise of 975,000, with the previous release at 916,000, while the Unemployment Rate forecast at 5.7%, with the last release at 6.0%.
From the technical standpoint, the overnight’s surges are expected to encounter a bearish ambush upon any challenges towards $1,802-08.
The downside target holds to a trajectory of $1,746-48, with the immediate support at $1,760.