Gold Rallying into NFP
Gold prices are continuing to rally on Friday ahead of the keenly awaited December jobs report this afternoon. The safe-haven metal has been on a solid winning streak over the first full trading week of 2025. Despite fresh strength in USD, gold prices look to be attracting demand as a result of ongoing global geopolitical risks as well as uncertainty ahead of Trump taking office this month and, more recently, the wildfires in Los Angeles. Looking ahead today, focus will of course be on the latest US jobs data with the potential for a breakout move in gold if we see any downside surprise in the data.
Forecasts & Trading Scenarios
On the numbers front, the market is looking for the headline NFP release to have cooled to 165k from 227k prior. If seen, this should keep gold prices underpinned into next week. However, If we see the data undershoot this forecast, gold prices are vulnerable to a much sharper move higher as traders rebuild Q1 Fed easing expectations, leading USD firmly lower. On the other hand, if data comes in above forecasts today, USD is likely to rally firmly as traders price out a Q1 rate cut. In this scenario, gold prices look likely to give up recent gains and return to the last support level.
Technical Views
Gold
The latest test of the 1,604.56 level has seen the market bouncing sharply with price now fast approaching a test of the December highs around 2,718.88. This is a key level for the market and a break here will be firmly bullish, putting focus back on 2,789.40 next. To the downside, bears need a break of 2,604.56 to turn focus to deeper support at 2,530.59 next.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.