Gold Today 09/06: Drops After Non-Farm Payroll (Chart)

(MENAFN- Daily Forex)

• Gold markets drop during the trading session on Friday after initially trying to rally, as the jobs report in the United States came out a little hotter than anticipated.
• This had the US dollar strengthening, because it does suggest that perhaps the Federal Reserve might wait a while to cut rates, and therefore it had a little bit of a negative influence on gold.

Recently, we have been consolidating in this market, and I think that remains the case despite the fact that it was a somewhat ugly short-term move. Ultimately, the market has been bouncing around $3500 above, and the $3200 level below. The 50 Day EMA is near the $3250 level and rising, and I think that it will end up being a potential short-term floor in this market.

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As you can guess, I think that the market is essentially going sideways at the moment and is not sure where it wants to be over the next few weeks. However, I think that in the longer term we are still very bullish of gold, at least as long as we can stay above the psychologically important $3000 level. The $3000 level is much lower than where we are at the moment, and it is now starting to attract the attention of the 200 Day EMA, which is a longer-term trend indicator. If we were to break down below that indicator, then I think a lot of people would get really short of gold. However, right now we are light years from that happening, so that's just something that I have in the back of my head, not necessarily something that I am willing to bet on.

EURUSD Chart by TradingView

Short-term dips should continue to be attractive for longer-term buyers, and you could even make an argument that we are in the process of trying to sort out whether or not we can form a longer-term bullish flag. (Full disclosure: I'm not necessarily sold on this idea, and I'm the first to admit that it's an ugly one.) With that being said, I think there are too many things working for gold right now to bet against it.

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