Last night, both US July job openings and August consumer confidence index fell below expectations, causing the US dollar and bond yields to drop, and gold rose accordingly.
According to data released on August 29 by the US Labor Department, there were 8.8 million job openings in July, lower than the previous figure of 9.2 million and the market expectation of 9.46 million. This is the lowest level since March 2021 and the sixth consecutive decline in the past seven months.
Source: Investing.com
The above data indicates that the Federal Reserve's monetary tightening policy is taking effect, with a decrease in resignations which will suppress wage increases. The demand side of the labor market is cooling down, reducing the probability of further interest rate hikes by the Federal Reserve later this year, which is overall favorable for gold.
It is worth mentioning that the August US CB consumer confidence index, released simultaneously with the job openings data, also declined. The data shows that the US consumer confidence index dropped to 106.1 in August, a decrease of 7.9 from July's reading of 114, and significantly lower than the market expectation of 116. This is the first decline in the data after two consecutive months of increase.
In addition, according to a survey by Dana Peterson, Chief Economist of the Conference Board, US consumers have shown concerns about rising prices, especially in food and oil. In the August survey, consumer confidence in almost all age groups declined.
Some analysts believe that the decline in the index indicates increasing consumer concerns about future inflation and the labor market. However, experts also believe that although personal consumption expenditures may slow down in the coming months, there won't be a cliff-like decline.
After the release of the above data, gold rose in response, rising over $14 at one point during the session and ultimately closing near $1937.
From a technical perspective, considering that July job openings and August consumer confidence index have been priced in by the market, gold's short-term range may fluctuate between $1924 and $1937, awaiting guidance from the non-farm payroll data to be released this Friday. Resistance: $1945, $1954; Support: $1924, $1914.
Source: Mitrade Webtrader, 1-hour gold chart
