Non-Farm Data Shocks Market, Gold Eyeing Plunge
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Data shock: On Friday evening, October 4th, data released by the U.S. Department of Labor showed that the seasonally adjusted non-farm employment population increased by 254,000 in September, significantly exceeding the expected increase of 140,000, with the previous value revised from 142,000 to 159,000. The U.S. unemployment rate in September was 4.1%, the lowest since June 2024, with the previous rate at 4.2%. In addition, the non-farm new employment number for July was revised from 89,000 to 144,000; the non-farm new employment number for August was revised from 142,000 to 159,000. After revision, the total increase in employment for July and August was 72,000 higher than before the revision.
After the data was announced, traders canceled their bets on a 50 basis point rate cut in November, and the expectation for the cumulative rate cut in the next four Federal Reserve meetings was less than 100 basis points. Bank of America adjusted its expectation for the November Fed rate cut from 50 basis points to 25 basis points. JPMorgan expects the Fed to cut rates by 25 basis points in November, down from the previous expectation of 50 basis points.
Gold: After the non-farm data, gold plummeted at one point, stopping at the 2632 level and then rebounding sharply, reaching a high of 2670 before falling again, closing the day at 2653 with a doji line. The weekly chart closed with a bearish doji star. The impact of the non-farm data seems not as significant as the data itself. Although the expectation for the rate cut has decreased, gold did not stabilize after falling; next, pay attention to this week's U.S. CPI data, Federal Reserve meeting minutes, and speeches by related Federal Reserve officials.
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In terms of medium-term trends, gold is still dominated by bulls, but the strength is lacking, and it may reverse at any time. Since the rise from $1046, there have been six phased bull markets, with an average increase of $430; this round started to rise from $2285, and according to the average increase of $430, it is basically around $2715; after approaching or reaching the theoretical increase, pay attention to the adjustment and decline. Therefore, at this stage, be bullish but do not chase the rise, always waiting for a reversal.
In terms of short-term trends, gold is currently showing clear volatility, operating between the high and low points of last Friday, and it is estimated that it will be difficult to break through without news stimulation. The current U.S. news data is not friendly to gold bulls, and the surge in U.S. Treasury yields also suppresses gold; the situation in the Middle East supports gold bulls."Since the morning opening, gold has not dropped below 2640 and has not risen above 2660, still operating between the high and low points of the non-farm payrolls (NFP) report. It is expected that the evening will continue to be volatile within this range. The resistance levels for gold are 2668-73 and the new high area of 2685, followed by the 2715 area; the short-term support for gold is 2640, with a key focus on the 2632-30 area and the 20-day moving average region. In terms of operation, within the high and low points of the NFP day, we should sell high and buy low, and follow the trend if the range is broken. If there is an upward breakthrough, take a short position after the new high or focus on laying out a short position for the new high; if there is a downward break, look at the 20-day moving average and test the 2600 level. Next, I will focus on short positions, especially after new highs or near new highs, with long positions as a supplement or not participating at all.
Silver's trend is relatively chaotic compared to gold. In the last week of September, after breaking the new high of 32.5, it only moved up by 0.2 dollars before facing selling pressure; last Friday was the same, after the NFP data, it first fell and then rose, breaking the annual high, reaching up to the 32.9 level. Afterwards, like gold, it faced a plunge, closing near 32.2 on the daily chart, with a daily windmill line.
On the weekly chart, there are four consecutive positive candles, although it indicates a bullish rhythm, the strength is clearly insufficient, and each time it breaks a new high, it faces a plunge; the bulls are relatively not strong enough. Therefore, do not overly bullish on silver, even if it is going to rise, it still needs to accumulate strength. This week, we will first look at the consolidation, focusing on the resistance in the 32.7 area and the new high area, with short-term support at the 5 and 10-day moving averages, and the key focus on the 20-day moving average and the 30 level. In terms of operation, within the week, take short positions in the resistance area, and if it falls first, rely on the 20-day moving average and the 30 level to take long positions, following the direction of gold.
US crude oil, last week's weekly chart bottomed out with a big positive candle, with a single-week rise of nearly 9%, which completely met our expectations.
Looking at the chart, after crude oil completely stabilized in the 69 area, the bulls started to gain strength, and after standing above 72, it accelerated. After today's opening, the bulls continued last week's strength, and we will continue to look bullish, but do not chase in the short term, wait for adjustments before getting involved. The short-term support is in the 73.5-74 area, with a key focus on 72 and the 70 level. In terms of operation, take long positions when the price is low, with targets looking up at 77 and the 80 level. For the 80 level, if it continues to break through, a new rise will be welcomed, but the market will still fluctuate before the breakthrough.The US Dollar Index completed a bottoming and rebound last week, with a strong bullish weekly candlestick. This fully aligns with our bullish view before the break below 99-100!
The weekly chart is like a sudden rise in dry land, and the daily chart also shows five consecutive days of gains, indicating a strong dollar bullish trend. This week, we will focus on the continuity of the bullish momentum. After breaking above the 102 area, this level now forms short-term support, followed by the 10-day moving average support. In terms of operations, buy the dollar on dips, avoid chasing rallies, and be cautious with short positions. For other currency pairs, refer to the US Dollar Index.