Gold prices jumped 1% on Friday to their highest levels since April 2018 as a sharp slowdown in U.S. jobs growth sent the dollar lower on growing expectations that the Federal Reserve would cut interest rates this year.
The U.S. Labour Department reported on Friday that job growth slowed sharply in May and wages rose less than expected.”
The U.S. jobs number was weaker than expected and that rallied the gold market. That gives the bulls more technical momentum,” said Jim Wyckoff, senior analyst at Kitco.
Chances “have significantly increased that the U.S. Federal Reserve is going to lower interest rates sooner rather than later and that is also working in favour of the precious metals bulls,” Wyckoff said.
Lower interest rates boost gold by reducing the opportunity cost of holding the metal and by weakening the dollar, which skidded to its lowest in 2-1/2 months after the U.S. jobs data.
And with the rise in price this week, price breached the daily supply at $1333.
Price finds itself back in familiar territory…check out the weekly chart below.
If price can breach the $1400 level on the monthly chart, look for price to move higher to the monthly supply at $1600.
This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.