Before Trump-Xi meeting, we expected torrid statements from both parties but surprisingly, Trump came out expressing how tremendous US-China relation is. He even went ahead and said that both super powers have been making tremendous efforts towards ironing out obstacles and very soon many of those problems will be dealt with. This kind of positivity was indeed what the market wants to hear and it somehow boosted the USD. On Friday and as widely expected, the NFP data came in lower at only 98K jobs against a consensus figure of 180K. Unemployment ticked lower to 4.5%, average hourly earnings expanded by 0.2% and participation rate remained high at 63%. This was interpreted by the markets as fair for the US economy and immediately after the release, the USD loosed ground but it quickly recovered and closed higher. I expect a slow week but the USD should continue to edging higher in the coming week as we look forward for CPI and retail sales data before Easter Weekend.
My plan for the precious metal is simple, sell. This is mostly from a technical point of view and analysis from higher time frames. This is the third week where Gold id closing with long upper wicks but this week’s candlestick was pronounced. Usually, long upper wicks signify selling pressure and as the week closed with NFP data, investors liquidated Gold. The daily chart is important. Looking at the price action, there is a clear sell signal printed by the stochastics with a bear divergence being formed.
Trading in the coming week will be to short Gold at any highs in the 1HR chart at the following probable positions:
Sell Limits: 1258-1261
Stop Loss: 1266
Take Profit: 1238
Have a nice weekend.