Today’s Non-Farm Payroll (NFP) job numbers were certainly worse than anticipated and the US Dollar Index (DXY) has shown that on the charts. With technical and fundamental pressure from bears, we expect a weaker Dollar in the coming weeks and a bullish bias for Gold.
Today’s NFP release had the unemployment rate jump up from 5.8% to 6.1% which is the first increase in unemployment in the last twelve months. The job numbers were even worse with only 266,000 jobs being added versus the forecast of 990,000. Along with technicals, traders could see the Dollar reach 90.000 in the short term.
With the Dollar trending once again, price action traders were able to take long positions for Gold. Over the course of eight or so hours, traders were able to gain a profit of +190 pips from this one position. If the Dollar continues to slump over the weekend, traders can look to reenter long for the precious metal.
With the job report and Biden’s tax policy out of the way, participants in the markets can expect more predictable trading conditions in the markets. Next week should provide endless opportunities against the bearish Dollar for example.
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- Read yesterday’s breakdown: Gold Longs Setting up as Dollar Resumes Drop
