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Financial markets become quiet as investors wait for tomorrow's jobs report

Commentaries & Views

Gold, silver and palladium futures are trading higher on the day, and with the exception of platinum the precious metals have all shown gains. As of 5:18 PM EST gold is fractionally higher, currently fixed at $1481.10, which is a net gain of $0.90 (+0.06%). Palladium is also fractionally higher and fixed at $1846.30, with a net gain of $0.90 (+0.05%).

The largest percentage gain in the precious metals today was in silver futures. The most active March 2020 contract is currently back above $17 and fixed at $17.025, with a net gain of 10.9 cents (+0.64%). The only precious metal to have closed lower on the day was platinum futures which lost $2.40 and is currently fixed at $899.40.

Modest gains in U.S. equities, with the Dow Jones industrial average gaining 1/10 of a percent and closing at 27,677.79, after adding today’s 28-point gain.

It seems that both the precious metals and U.S. equities have had only fractional price changes, as market participants await tomorrow’s jobs report. Yesterday’s ADP report came in extremely short of the expectations which forecasted that the ADP national employment report for November would indicate a robust 150,000 new jobs added, the actual numbers came in at 67,000 jobs.

Tomorrow’s U.S. Labor Department nonfarm payroll is also expected to report an increase of 150,000 jobs added in November, however if yesterday’s ADP report is any indication, we could see the Labor Department’s numbers much lower than forecasted. If that occurs, we could see U.S. equities under pressure and safe haven assets such as gold moving higher. The Labor Department reported that there were 10,000 fewer applications for unemployment benefits, taking that number to 193,000.

That being said today, on a technical basis we must note that the 50-day and 100-day moving averages have formed a death cross as the 50-day moving average crossed below the 100-day in trading yesterday.

Currently there is very solid support at $1453 which is the 38.2 % Fibonacci retracement. Resistance first occurs between the 50 and 100-day moving averages which are currently fixed at $1486.50 (50-day) and $1491.20 (100-day). Above that is the first level of major resistance at $1497.70 the 23.6% Fibonacci retracement.

These retracements are using a data set which begins at $1269 and concludes at $1566, the highest price point gold has seen since the conclusion of a multiyear correction which took gold prices down to $1040 at the end of 2015.

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Wishing you as always, good trading,

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.