Gold price drops after US jobs data key levels.
On Monday morning, the gold price in the domestic futures market dropped significantly, in line with weak global cues and the rise of the dollar. Additionally, a strong U.S. jobs report dented expectations of a 50 basis point rate cut by the Fed in November. For the December 5 congrats, MCX Gold was trading 0.21 percent lower at ₹75,980 per 10 grams around 9:10 am. According to the Reuters report, U.S. job gains increased by the most in six months in September, and the unemployment rate fell to 4.1 percent. According to CME’s FedWatch tool, the market now sees a 95 percent chance that the Fed will cut rates by only 25 bps in November. Healthy macro numbers have strengthened the U.S dollar, which has weighed on gold prices. Since gold is priced in dollars in the international markets, a rise in the U.S currency makes gold expensive in other currencies. Gold has support at $2,658- 2,644 and resistance at $2,688- 2,704 per troy ounce, in today’s session. On the MCX, gold has support at ₹75,850- 75,600 and resistance at ₹76,500- 76,740. In Indian rupee terms, gold has support at ₹75,880-₹75,670 and resistance at ₹76,450 – ₹76,650. Gold and Silver prices remain volatile this week amid fluctuations in the dollar index and geopolitical tensions. However, on a weekly closing basis, they are expected to hold their support levels of $2,600 and $30.88 per troy ounce. Gold prices generally tend to rise in a low-interest-rate environment and during political and economic uncertainty. In the current situation, the escalating circumstances in the Middle East are a key positive for gold. If the Israel-Iran war escalates further, it could severely impact risky equities and trigger a significant buying spree of safe-haven assets.
