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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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Gold Shines As Rate Cut Hopes Overshadow Trade Fears

Article By: ,  Senior Market Analyst
June 6, 2019 12:42 PM
Once again weaker US data has investors eyeing up a rate cut by the Fed. Investors are so carried away with the prospect of lower rates that they as good as ignored Trump’s latest half a trillion-dollar threat on China.

As rate cut optimism trumps global trade concerns, gold is pushing higher. The precious metal extended gains for a seventh straight session, in a week that has seen it jump 2.2% in value. This is the longest winning streak for gold since Jan 2018. 

Today’s softer jobless claims figures come following a huge downside surprise in private sector job creation yesterday leaving investors unconfident that tomorrows non-farm payroll will be able to hit expectations. 

NFP Expectations:
185,000 jobs created vs 263,000 May
Hourly earnings 0.3% vs 0.2% May
Annual earnings 3.2% vs. 3.2% May
Unemployment 3.6% vs 3.6% May

Weaker job creation and stalling wage growth will boost expectations of a Fed cut sooner rather than later, pulling the dollar lower whilst lifting gold. Should the data surprise to the upside gold could be quickly paring gains.

Gold levels to watch:
The momentum of the gold run is still in play. Gold pushed through resistance at $1333, which now is its near term support. The bulls are aiming for $1346. This is the key resistance, the 2019 high so far. A mover above her could open the doors to $1367. On the downside a move below $1333 on stronger non farm payroll figures could see gold move lower towards $1323.


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