Gold Prices Rise Despite Robust Private Payroll Report

Key Insights

• Gold prices rebounded but remain rangebound
• The dollar eased slightly
• U.S. Treasury yields were lower

Gold prices moved higher on Wednesday as the dollar eased and Treasury yields. The market continues to price in 300-basis points of Fed tightening by 2023. Stronger than expected private payrolls failed to put upward pressure on Treasury yields.

According to ADP, Private payrolls expanded by 455,000 in March compared to expectations that they would rise by 450,000. The total was slightly below the upwardly revised 486,000 for February and brought ADP’s first-quarter jobs to count to 1.45 million. The report comes two days before the nonfarm payrolls report, with the Bureau of Labor Statistics expected to show jobs growth of 490,000 for the month.

Technical Analysis

Gold moved higher but remained rangebound. Support is seen near the 50-day moving average at $1,894. Resistance is seen near the 10-day moving average at 1,935. Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal.

The medium-term momentum has turned negative. The MACD histogram prints in negative territory with a decelerating trajectory pointing to lower gold prices.