XAUUSD - The precious metal gold has returned above $1800 after creating a new low last week at $1784. The price formed a new high in July $1814 during the Asian session today. The bulls are pushing higher and aiming for higher levels above this region. The immediate resistance to gold today was seen in $1817. A break above this will give way to the next opposition in $1837. However, should the price fail to break this first resistance and fall below the daily support at $1806, we might expect a retest of the significant support at $1796.
Significant Factors to influence gold this week
NFP Report: The Non-Farm Payroll report, which gives the unemployment rate, is due to be released this Friday. There are predictions that this week's NFP will favour gold so much. This is based on the US ISM Manufacturing PMI report for June released last week, which produced the worst report ever in two years. The ISM Manufacturing PMI for the concluded month had fallen to 53.0 against the market expectations of 54.6. This is highly opposed to the 56.1 data recorded previously. The ISM Manufacturing PMI data showcased a sharp decline in the Employment Index, which had declined to 47.3 from the previous record of 49.6. Similarly, the Prices Paid Index fell to 78.5 from the last record of 82.2. This is very contrary to the market expectation of 81.0. With these weak figures on the ground pointing to a reduction in the employment rate, analysts, therefore, forecast high unemployment rate digits from the coming NFP report. As expected, a high unemployment rate favours gold and weakens the US dollar.
Fed's Minutes: Another vital factor to influence gold this week is the Minutes of the Federal Open Market Committee (FOMC), to be delivered on Wednesday. The Minutes of the last Fed Session in which the Interest rate was hiked by 75 basis points are due to be given this week. Also, during this session, the Committee will decide whether to walk the interest rate in July. The outcome of this meeting will greatly influence gold. Thus, any other hawkish stance from the Committee will send gold prices to the grave again.
Other Factors to influence gold this week
JOLTS Jobs Openings: This measures the number of new Jobs openings within the month which are not yet filled by unemployed people and excludes the farming industry. The forecast for this data is 10.85 million, while the previous record was 11.40 million. Higher reading is gold for the US dollar, a disadvantage for gold. This data is due to be released on Wednesday.
ISM Services PMI report: This measures the level of the diffusion index on new purchases by the purchasing managers, excluding the manufacturing industry. Higher reading from this data above 50 is good for the US dollar. This will lead to a decline in gold prices. On the contrary, lower readings from this report will be a tremendous advantage for gold. This report is to be released on Wednesday.
ADP Non-Farm Employment: This data gives an estimated change in the number of employed people during the previous month, excluding the farming sector. Higher readings from this report will strengthen the US dollar and weaken gold. The forecast for this data is 200k, while the previous record was 128K. This report is to be released on Thursday.