Gold inched lower on Monday, decreasing the price of yellow metal to less than $1225.00 an ounce following some key economic releases. The technical bias remains bearish because of a lower low in the ongoing downside move.
Technical Analysis
As of this writing, the precious metal is being traded near $1208 an ounce. On the downside, a support may be noted around $1205, an immediate horizontal support ahead of $1200, a key horizontal support as well as psychological number and then $1180, another major horizontal support area.
On the upside, a hurdle can be noted near $1295, the high of the last major upside rally ahead of $1300, the psychological level as demonstrated with red color in the given below chart. A break and daily closing above the red mark shall trigger renewed buying interest, validating a rally towards the $1340 resistance zone. The technical bias shall remain bearish as long as the $1200 support area is intact.
US Nonfarm Payrolls
The U.S. job market roared back to life in June, with a better-than-expected 222,000 new positions created in June while the unemployment rate held at 4.4 percent, according to a government report Friday.
Economists surveyed by Reuters had been expecting nonfarm payrolls growth of 179,000 and the unemployment rate to be 4.3 percent.
Wage growth, however, remained muted, with average hourly earnings rising 2.5 percent on an annualized basis, essentially unchanged from the previous month. On a monthly basis, the rise was 0.2 percent, which actually was a shade below the 0.2 percent expectation. The average work week edged higher, rising 0.1 hours to 34.5.
Trade Idea
Considering the overall technical and fundamental outlook, selling the precious metal around current levels appears to be a good strategy in short to medium term.
