Gold Technical Report: Gold prices traded rangebound with a positive bias on Friday. It made an intra day high near above 50 days Exponential moving average @ 1951 but could not cross over. The primary trend support is near 200 days EMA @ 1876. If prices move above 1984 which is last 3 months TrendLine resistance, it will open room for further advancement upto the major psychological level of 2000 and above. The short term Stochastics Oscillator is at 13 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 45 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices registered a long legged Doji on Friday after it declined for earlier three straight sessions. It crossed above 100 days Exponential moving average @ 23.66 but could not sustain and retraced back at the close. The Primary Trend support is near 200 EMA @ 22.70 below which it will turn bearish. The Short term Stochastics Oscillator is at 10 and Relative Strength Index near 41.
Fundamental Report: Friday’s U.S. employment report showed a slower than anticipated job growth in July, suggesting a cooling labor market. The data strengthened speculations that the recent rate hike by the Fed could be the final leg in the current tightening cycle. However, solid wage gains and a falling unemployment rate hint at persistent labor market tightness, thus painting a mixed picture that leaves the Fed’s interest rate path wide open. Next big event being upcoming U.S. consumer prices (CPI) data due for release on Wednesday. It will be a key determinant in understanding if additional rate hikes are warranted to keep inflation in check. Gold, traditionally considered a safe bet against inflation, may lose its appeal should rates rise. As the evolving economic landscape, the outlook for gold seems to hinge on further weakening of the U.S. dollar. While the post-jobs data conditions have brought some relief for gold, it might take a significantly softer dollar to give the yellow metal a solid boost. Until such a scenario unfolds, the gold market is likely to remain volatile and traders should tread with caution.