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GOLD: Dumped With Equities

GOLD
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General risk-off sentiment on Thursday, emphasised by the sharp weakness for major equity benchmarks, prompted a solid pullback for gold. The spot price declined 1.5%, unwinding an overbought condition for the yellow metal.

  • Bullion is steady in today’s Asia-Pac session ahead of the release of US Non-Farm Payrolls later today. Nonfarm payroll growth is expected to slow materially to circa 100k in October after a booming 254k in September, with significant disruption from strikes and potential hurricane fallout.
  • The Fed’s Waller has previously estimated this could drag 100k from payrolls this month although that appears right at the top end of analyst expectations. (See MNI NFP Preview here)
  • The US Fed’s next policy meeting is on November 6-7. Traders continue to price in a roughly 90% chance of a 25bp cut next week. Lower rates are typically positive for gold, which doesn’t pay interest.
  • According to MNI’s technicals team, the trend condition in Gold is unchanged and bulls remain in the driver’s seat. The latest climb has resulted in a breach of $2685.6, the Sep 26 high, confirming a resumption of the primary uptrend and maintaining the price sequence of higher highs and higher lows.
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General risk-off sentiment on Thursday, emphasised by the sharp weakness for major equity benchmarks, prompted a solid pullback for gold. The spot price declined 1.5%, unwinding an overbought condition for the yellow metal.

  • Bullion is steady in today’s Asia-Pac session ahead of the release of US Non-Farm Payrolls later today. Nonfarm payroll growth is expected to slow materially to circa 100k in October after a booming 254k in September, with significant disruption from strikes and potential hurricane fallout.
  • The Fed’s Waller has previously estimated this could drag 100k from payrolls this month although that appears right at the top end of analyst expectations. (See MNI NFP Preview here)
  • The US Fed’s next policy meeting is on November 6-7. Traders continue to price in a roughly 90% chance of a 25bp cut next week. Lower rates are typically positive for gold, which doesn’t pay interest.
  • According to MNI’s technicals team, the trend condition in Gold is unchanged and bulls remain in the driver’s seat. The latest climb has resulted in a breach of $2685.6, the Sep 26 high, confirming a resumption of the primary uptrend and maintaining the price sequence of higher highs and higher lows.