Wall Street on the sidelines in the gold market as blockbuster non-farm payrolls spark calls for the Federal Reserve to raise 75 basis points in September

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(Kitco News) – Gold market sees third week of gains; However, sentiment is changing again, as prices cannot top $1,800 an ounce, according to the Kitco News Weekly gold survey.

In the latest gold survey, some market analysts said Friday’s massive employment report put the wind out of gold’s sails, at least in the short term.

Before the results of the latest survey, the US Bureau of Labor Statistics said 528,000 jobs were created in July. The data largely beat expectations as economists expected job gains of around 250,000. The report also indicated a significant increase in wages.

While some analysts continue to see more upside, many have taken a more neutral and bearish stance. Retail investors remain strongly optimistic about gold.

“The gold market has given us a taste of what the Fed pivot will look like, but the real pivot has yet to emerge,” said Adam Patton, chief currency analyst at Forexlive.com. He is looking for lower prices in the near term. “The CPI next week is a huge risk for gold and almost everything else.”

This week, 16 Wall Street analysts participated in the Kitco News gold survey. Among the participants, four analysts, or 24%, were optimistic about gold in the near term. Meanwhile, seven analysts, or 41%, were bearish on gold. Six analysts, or 35%, cast neutral votes this week.

Meanwhile, 579 votes were cast in online Main Street polls. Of those, 379 participants, or 65%, looked for a gold rally next week. 124 voters, or 21%, said less than that, while 76 voters, or 13% were near-neutral.

The shift in sentiment on Wall Street comes as gold prices look to end the week in nearly neutral territory, pulling back from a three-week high. December gold futures were trading at $1,789.10 an ounce, up less than 0.5% from last Friday.

Analysts said the July employment report alone changed sentiment in the market as investors now expect the Federal Reserve to maintain its aggressive stance on monetary policy in September.

US jobs data means the Fed is likely to raise 75 again [basis points] next month. The luster of gold is weaker. “Breaking $1750 could lead to $1,725, but there is a reasonable chance he could see $1700,” said Mark Chandler, managing director at Bannockburn Global Forex.

The CME FedWatch tool shows that markets now see more than a 70% chance of a 75 basis point move next month. Prior to the employment report, markets were expecting 34% of a strong move.

Adrian Day, head of Adrian Day Asset Management, said he is neutral on gold next week because the latest employment data will make gold investors more cautious. However, he added that in the long run, he remains optimistic.

Frank McGee, precious metals trader at Alliance Financial, said he’s trending lower in gold in the near term because the precious metal “can’t fight the Fed”.

However, some analysts remain optimistic about the precious metal, noting that prices are still holding support. Jim Wyckoff said that the market still has some bullish technical momentum that could push prices higher next week.

Disclaimer: The opinions expressed in this article are those of the author and may not reflect the views of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; However, Kitco Metals Inc. cannot. Nor does the author guarantee this accuracy. This article is for informational purposes only. It is not a solicitation to conduct any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. does not accept The author of this article will be liable for losses and/or damages arising from the use of this publication.

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