03/09/2021 – This Week in Gold

Price Movements

Gold investors will have been pleased to see gold trading safely above $1,800 per ounce for the entire week. After breaking back above the $1,800 level last week gold managed to hold and trade above that level consistently this week. This week’s trading opened at $1,818, before slipping to a weekly low of $1,803 on Tuesday afternoon. A sharp bounce back from this low occurred after the release of the U.S. Confidence data on Tuesday at 3pm. Gold spent the majority of the week bouncing between a range of $1,807-$1,816. Then, the news broke of disappointing U.S employment data on Friday which boosted the price of gold to the upside. Similar to last week the price momentum is strong coming into the weekly close. Gold’s weekly high currently stands $1,826 at the time of writing and the bulls do seem to be in control as the market digests the news of the underwhelming US employment data. Gold hasn’t been trading at these levels since early August and would seem to be on track to test its next resistance level at $1,830. 

Silver seems to have formed a strong base near the $24.00 mark this week. This week’s trading opened at $24, dropping to a weekly low of $23.75 on Wednesday. A break-out on Friday saw silver trade at $24.67, which is an increase of 2.79% in the value of silver this week.

Consumer Confidence & Monstrous NFP miss

Consumer confidence in the US weakened in August with the Conference Board’s Consumer Confidence Index declining to 113.8 from 125.1. This reading came in worse than expectations of 122.9. This news had a negative impact on the Dollar index and improved sentiment in the gold market. 

The main news this week was the Non-Farm Employment Change data from the United States on Friday. There was a large miss in the August jobs report for the month of August. Despite payrolls for August rising by 235,000 this number comes in far below expectations of 720,000. The unemployment rate did come in at 5.2% as expected. Overall, this disappointing data saw the dollar fall in value and acted as the major catalyst for gold’s strong price action heading into the close of the week. 

In summary, between inflation running hot at the moment and employment data falling short of expectations, gold has improved significantly to a monthly high.