Gold on the NFP Wave: The Music of Fear

#XAUUSD

Key zone: 3,450.00 - 3,550.00

Buy: 3,500.00 (on a pullback after a correction); target 3,650.00; StopLoss 3,420.00

Sell: 3,420.00 (after a strong breakdown of 3.450); target 3,250.00; StopLoss 3,500.00

Exchange-traded gold is not just a metal – it is a market weapon, a witness to collapse or triumph. Today, this eternal asset is back in the spotlight: we await the impulse from the latest jobs report. This is the very NFP that keeps the entire market in suspense every first Friday of the month.

It may seem strange that simple employment numbers can influence billions in gold capital, but NFP is a fairly honest mirror of the American economy. If NFP shows an increase in jobs, the dollar revives, yields rise, and gold feels uncomfortable. If the labor market weakens, the dollar loses stability, and capital flows into gold.

The current situation is especially interesting: after records near $3580 per ounce, gold slightly corrected, but since the beginning of the year, the precious metal has gained almost 37%. This means the market is actively seeking protection and is willing to pay for peace of mind with gold.

The main driver now is the expected Fed rate cut, and the market estimates the probability of a 0.25% cut at 97.5%. The dollar is already weakened by expectations, but how far and how fast it will fall will be answered by the NFP.

Reminder: The Fed operates on the principle of “inflation + employment.” Possible scenarios:

• If NFP is strong (more than 120K new jobs), the dollar will get a reprieve, and gold may fall to $3450–3500. If unemployment stays around 4.2%, the market will see this as stability, and gold will have no choice but to drop.
• But if slightly negative data appear, as in July (only 73K), and unemployment rises to 4.3% or higher, for investors this is no longer just statistics but a signal of catastrophe: the economy is cooling. Pressure on the dollar will intensify, and gold will surge to $3600–3650 or higher.
• If the result is average (about 75K new jobs with stable unemployment), the market will likely avoid speculation. Then gold will be stuck in the $3500–3550 range.
• If NFP beats expectations and unemployment declines, gold could quickly retreat to the lower boundary of $3400–3450, while the dollar gains optimism.
• If both indicators disappoint (weak NFP and higher unemployment), the market will see this as a clear signal for further Fed easing. This will accelerate dollar weakening and push gold above $3650–3700.

Gold failed to gain during the Asian session; the price remains in the historical maximum zone reached earlier this week. Bets on a Fed rate cut later this month are keeping U.S. dollar bulls from going aggressive and are acting as a tailwind for gold. So we act wisely and avoid unnecessary risks.

Profits to y’all!