Technical Analysis

GOLD Analysis – October 11, 2021

By LonghornFX Technical Analysis
Oct 11, 20213 min

Upward Trendline Support

Gold prices concluded at $1757.40, with a high of $1782.40 and a low of $1753.60. Gold reached its 12-day high on Friday, despite the poor jobs report from the U.S. Labor Department, but it fell back due to rising U.S. Treasury yields.

Gold has moved approximately $40 this week, appearing to be moving towards the $1800 level at one time before reverting to the mid-$1700 levels. The U.S. Dollar Index, which measures the greenback's value against a basket of six major currencies, dipped to 93.94 on Friday, weighing on the U.S. dollar.

The 10-year Treasury yield in the United States has achieved its highest level since May 30, at 1.61 percent.

The poor September jobs report propelled gold higher in the market, but a jump in yield capped any gains and brought yellow metal lower. Gold prices rose due to the abysmal growth in non-farm payrolls in September, which totaled 194K below the projection of 500K and fell short of the previous month's 235K.

The lackluster September job growth signaled that the Federal Reserve might not proceed with unwinding its pandemic-era monthly boost of $120 billion in bond purchases. However, the NFP data was released, but the unemployment rate fell in the same month and strengthened the U.S. dollar, limiting the day's gains in gold prices.

At 00:00 GMT, the Consumer Credit from August fell to 14.4 billion, vs. the anticipated 17.4 billion, weighing on the U.S. dollar and supporting gold prices. At 17:30 GMT, the September Average Hourly Earnings increased to 0.6 percent, versus the projected 0.4 percent, helping the U.S. dollar and limiting further increases in gold. The Non-Farm Employment Change fell to 194K from 490K expected, weighing on the U.S. dollar and pushing gold higher. The unemployment rate also fell in September to 4.8 percent, below the anticipated 5.1 percent, bolstering the U.S. currency and limiting the rise in gold prices. Final Wholesale Inventories were 1.2 percent more than expected at 19:00 GMT.

Furthermore, the U.S. dollar was lower on board due to the standoff over lifting the debt ceiling. According to U.S. Treasury Secretary Janet Yellen, the failure to raise the debt ceiling would be a catastrophe. On Thursday, the Senate reached a deal to hike the debt ceiling by $480 billion to pay the nation's bill through December 3.

GOLD Intraday Technical Level

Support Resistance

1746.28 1774.19

1735.89 1791.71

1718.37 1802.10

Pivot Point: 1764.68

GOLD - Technical Outlook

Gold is trading with a slight bearish bias at the 1755 level and below an intraday pivot point of 1763, indicating a bearish bias for the precious metal gold.

On the upside, gold is anticipated to encounter immediate resistance around 1763, while a break above 1763 might push gold prices to the following resistance levels of 1773 and 1779. While gold is now bearish, it may find immediate support at 1753, which is being extended by an upwrd trendline on the 4-hour timeframe.

Below this pivot point, the 50-day SMA (simple moving average) at 1751 provides immediate support. Gold's bullish bias remains strong above 1,749 and bearish below the same level as the market is pricing in stronger than expected U.S. unemployment rate and wages data.

All the best!


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