Precious Metals Rally Helped by Weak NFP

September 5, 2016

GOLD

Gold rebounded after testing the significant support level at 1300 on 2nd September. The weak NFP figure helped spot Gold surge from 1296.66 to 1330.07, a 2.58% intra-day rise.

The price retraced after testing the significant resistance level at 1330, where also the uptrend line resistance situates. It currently holds above the newly formed support level at 1320. The next support line is at 1310, followed by 1300.

The resistance level is at 1330, followed by 1335 and 1340.
The 4 hourly Stochastic Oscillator is above 80, suggesting a pullback.

Keep an eye on the upcoming US economic data, as it will influence the strength of the dollar and the trend of gold prices.

Silver

After the NFP and Unemployment Rate figures were released, Silver surged and broke the significant downtrend line resistance at 19.20, turning bullish.

The resistance level is at 19.50 followed by 19.70 and 20.00.
The support level is at 19.20, followed by 19.00 and 18.80.

The 4 hourly time frame Stochastic Oscillator is above 80, be aware of a pullback prior to the next rally.

The Dollar Index (DXY)

After the figures were released, DXY plunged to a week low of 95.17, from 95.79, a 0.65% fall. Yet after testing the significant support level at 95.20, the index rebounded sharply, broke the resistance level at 95.80 and retraced. It currently holds above the level at 95.60. The next support line is at 95.40, followed by 95.00. The resistance level is at 95.80, followed by 96.00 and 96.23.

The daily and 4 hourly time frame Stochastic Oscillator (KD indicator) are both crossing over downward, suggesting a retracement.
Keep an eye on the upcoming US economic data, as it will influence the strength of the dollar and the trend of the dollar index.

USDJPY

USDJPY has turned bullish since 26th August. The release of the weak NFP figure didn’t weigh on USDJPY. On the daily chart, it broke the major downtrend line resistance and tested the next resistance level at 104.00. The next resistance level is at 105.00, followed by 105.50.

The support line is at 103.00, followed by 8 EMA at 102.70 and 20 EMA at 102.40.
The daily time frame Stochastic Oscillator (KD indicator) is above 75, suggesting a retracement.

AUDUSD

AUDUSD turned bearish after Yellen’s hawkish speech on 26th August, yet it rebounded on 31st August after testing the significant support level at 0.7500. On 2nd September it tested significant resistance level at 0.76, where also the uptrend line and downtrend line resistances situate, then pulled back.

It is currently testing the resistance level at 0.7600 again. If it is confirmed broken, the next resistance is the 50% Fibonacci retracement level at 0.7625, followed by 0.7658 and 0.7700. Be aware of selling pressure in this price zone as its where the major resistances situate.

The support line is the 20 EMA at 0.7580, followed by 0.7550 and 0.7500.
The 4 hourly time frame Stochastic Oscillator is above 70, be aware of a pullback.

Keep an eye on the RBA Interest Rate decision, to be released at 04:30am GMT on Tuesday. The RBA announced a rate cut from 1.75% to 1.5% on 2nd August. Therefore, it is more likely that the rate will remain unchanged this time.

If AUDUSD keeps on strengthening, then the chance of a further rate cut will be increased in the third quarter.

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