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Fundamentals

During the Asian session on Wednesday (December 6), spot gold fluctuated upward slightly and is currently trading around 2020. Job openings announced overnight fell far short of expectations, while PMI data came in better than expected. The US dollar index rebounded, and gold prices retreated under pressure. Gold prices fluctuated to the downside after rebounding slightly to around 2042 in the Asian session, and fell to a low of around 2009.5 in the US session. These movements were basically in line with our expectations. We earned $10 by entering a long position at $2010. Investors who shorted after the rebound in the Asian session would make more profits. Next week, on Dec. 12-13, the Federal Reserve will hold its policy meeting, and it is broadly expected to leave interest rates unchanged at this meeting. The market, however, is still betting on an early March rate cut. According to the CME FedWatch Tool, the probability has risen to 62.6%, but I still think the market is jumping the gun. It's probably too optimistic about the rate cut next March. This expectation will be adjusted and corrected with the release of a series of economic data. Gold will inevitably pull back. In the short term, we maintain the idea of going short following a rebound, but do not chase the market! For aggressive traders, they can also buy low after gold being oversold.

Data: US JOLTs job openings fell to 8.733 million in October after two consecutive months of increases, a two-and-a-half-year low, far below expectations of 9.3 million. The final data of ISM non-manufacturing index was 52.7, compared with the expected 52 and the previous 51.7. The final data of the US Markit services PMI in November was 50.8, a record high since July, compared with the previous reading of 50.6.  

Today, investors need to pay attention to the US ADP employment data and the October trade balance.  

Technical Analysis

After the gold price rose slightly in the Asian session yesterday, it fluctuated downward and fell as low as 2009.5. Then, gold rebounded to around 2020 and finally closed with a small bear candle, falling for two consecutive days. According to inertia, gold prices will still be weak today. However, with the dual support of $2010 and $2018, it is not easy to effectively break below them. The these two levels are broken, the price will move down to 1997. At present, the price is gradually moving downward, and the resistance in the 2035-2041 area should be focused on during the day. Aggressive traders can still try to go short with small positions, but small stop losses are required to avoid uncontrollable losses. At the same time, if you attempt to go long, it is better to wait for the golf price to effectively fall to the 2005-2010 area, which will be safer.

Trading Recommendations

Trading Direction: Short

Entry Price: 2035

Target Price: 2010

Stop Loss: 2040

Support: 2020.000/2010.000