This week, investors are keeping a close eye on several key events: the Non-Farm Payrolls (NFP) report, elections in France and the UK, and remarks from Federal Reserve Chairman Jerome Powell. Each of these events has the potential to inject uncertainty into the markets, leading investors to seek the relative safety of gold.
Risk Events and Safe Haven Appeal
Gold often acts as a safe haven during times of political and economic uncertainty. With the markets bracing for the outcomes of the French and UK elections and sensitive to any signals from Powell on monetary policy, gold’s appeal as a protective asset remains strong. The NFP report is another critical event; unexpected results can cause significant market shifts, further supporting gold’s role as a stabilizer.
Commercial Traders and Market Sentiment
The Commitment of Traders (CoT) reports reveal that commercial traders are selling gold, but not at levels indicative of a market top. This suggests that while there is some selling pressure, it is not overwhelming, and the market might still have room for growth. The absence of extreme selling by commercials can be seen as a bullish indicator, aligning with the ongoing upward trend.
Technical Levels and Price Support
From a technical perspective, gold prices have maintained levels above the key swing low of $2,280.00. Staying above this support level is crucial for sustaining the bullish outlook. On the hourly chart, a significant volume was observed around the $2,330.00 mark. If gold prices were to pull back to this level, it could serve as a strong support point, providing a buying opportunity for traders looking to capitalize on any dips.
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