Friday’s NFP may trigger more volatility for gold

Gold has been dragged back closer to the psychologically-important $1900 level by Thursday’s blockbuster private payrolls number.

The precious metal may yet see further volatility on the highly-anticipated US nonfarm payrolls (NFP) report due Friday.

Should the NFP report confirm that the US hiring remains resilient, that should further firm up bets for a Fed rate hike later this month, which may drag gold into sub-$1900 waters.

A softer-than-expected US jobs report may offer immediate, but limited, relief for bullion bulls.

From a technical perspective, the precious metal was resisted by its 21-day simple moving average (SMA) mid-week, halting its attempted rebound off the psychologically-important $1900 mark.

Bullion bulls would have to conquer the 21-day SMA to potentially inspire further upside, though near-term gains are likely severely limited especially if the Fed can continue hiking further.

To the downside, bullion bears would be eager for a chance to break below the $1891.78 level, which is also the 38.2% Fibonacci level from gold’s Sept 2022-May 2023 ascent.