Gold Price Prediction – Prices Rose as Momentum Turns Positive

Gold prices continued to rally on Wednesday in the wake of the better than expected ADP private payroll report. The dollar declined sharply, giving gold prices a boost. U.S. yields were mixed, surged higher. The higher yields weighed on gold prices, offset by a lower greenback.

Technical Analysis

Gold prices rallied on Wednesday as the dollar slumped. Prices bounced off support seen near the 10-day moving average at $1,811. Resistance is seen near a downward sloping trend line at $1,865.  The 10-day moving average has crossed above the 50-day moving average which means that a short-term uptrend is now in place. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. The MACD histogram is printing in positive territory with an upward sloping trajectory which points to higher prices.

 ADP Private Payrolls Rose

Private job growth accelerated by 807,000 for December, above expectations of 375,000 and the November gain of 505,000. The November total was revised lower from the initially reported 534,000. According to the ADP data, the total was the best for the job market since May 2021′s 882,000 figure. Hiring was broad-based, though leisure and hospitality led with 246,000 new positions.