- The gold price (XAUUSD) moved laterally and in a muted manner around the $2,340 handle at the beginning of July. However, the future may bring about the necessary volatility for gold bugs to find trading chances. Jobs Week is underway, and markets will get a glimpse of the direction the US economy is headed on Friday. It’s anticipated that the workforce will experience a refreshing summer wind.
- Stated differently, researchers estimate that 189,000 new hires entered the workforce in June. The figure will have a significant impact on the economy’s course since it will direct the Federal Reserve’s interest rate-cutting decisions. Reducing borrowing costs is more likely if the print is at or below expectations. Conversely, a hot reading will cause rate-cut prospects to regress even further.
What part does gold play in all that?
- As an asset, gold does not give returns; in contrast, the US dollar’s value is dependent on the level of interest rates. The appeal of gold as an investment rises as rates fall, or are expected to fall because low rates reduce the opportunity cost of investing in gold. Given that, this Friday should be avoided due to increased volatility.
Source:
tradingview
