Analysis of international gold price trend, foreign exchange MT4.MT5 market grasp

On Friday (July 8), the international gold price rebounded weakly, as the U.S. dollar index hovered near a nearly 20-year high, limiting the demand for gold by non-dollar holders. The Federal Reserve continued to show a hawkish posture, and the gold price looked at $1,717 in the market outlook. Investors awaited non-farm payrolls data due later in the day.

 

At 14:48 Beijing time, spot gold rose 0.16% to US$1,742.96 per ounce; the main COMEX gold futures contract rose 0.09% to US$1,741.3 per ounce; the US dollar index sank 0.04% to 107.037.

 

 

The price of gold hit a new low of $1732.17 per ounce this week since the end of September 2021, and the U.S. index refreshed to a new high of 107.285 since early December 2002. U.S. nonfarm payrolls data to be released at 20:30 Beijing time is expected to show that the number of new jobs created in June fell from the previous month, and wage growth may slow.

 

FXStreet analyst Dhwani Mehta released a report saying that the price of gold is still hovering below $1,750 an ounce, and traders did not open large positions before the release of the most important U.S. non-farm payrolls data. “A slowdown in U.S. job and wage growth could dissuade the Fed from aggressively tightening across the board. In this case, dollar-denominated gold could see fresh buying immediately after the data. Although a tighter labor market may Justified the U.S. central bank’s stance on rapid and larger rate hikes, but it has revived recession fears. The dollar is likely to remain a win-win situation regardless of the payrolls report.”

 

Two hawkish Fed officials said on Thursday (July 7) that they supported another 75 basis point rate hike later this month, but later slowed the pace of policy tightening, although both downplayed the rise in borrowing costs that led to the U.S. At risk of recession.

 

"With the market narrative shifting from high inflation to a slowing economy, gold bulls are hoping for a lessening of Fed hawkishness, but dovishness has yet to pick up," said Stephen Innes, managing partner at SPI Asset Management.

 

"We should expect U.S. yields to remain firm ahead of U.S. CPI (consumer price index) data next week, so gold may struggle to move above the $1,750/$60 range," Innes said.

 

According to the latest data from the Chicago Mercantile Exchange Group, the open interest in the gold futures market fell by about 4,200 contracts last trading day, ending two consecutive increases. Volume fell for the second day in a row, this time down by about 155,600 contracts. The bulls appear to be consolidating at the low end of the range, while both open interest and volume are down, suggesting that there is little chance of a further pullback in gold prices in the near term.

 

From the daily chart, the price of gold has started a downward ((v)) wave trend from $1879, and the market outlook will further see the 76.4% target at $1717 and the 85.4% target at $1698. Wave ((v)) is a sub-wave of the descending wave C that started at $2,070. Wave C belongs to the correction (IV) wave that started from $2075.