Gold holds near $4,172 into payrolls as the dollar sits at a 17-month high

What moved overnight

Gold slipped again in early Friday trade, with spot down 0.6% to $4,154.78 and on track for a second straight weekly loss of more than 3%. The damage is coming from the dollar and yields, not from gold itself. The DXY climbed to a 17-month high around 102.14, and the 10-year Treasury yield hit 5.34% on Thursday, its highest since 2002, with the 30-year right there with it.

Thursday's session told the real story about positioning. A softer-than-expected US inflation print halved the odds of another Fed hike and spiked gold to an intraday peak of $4,251.20, but the rally was sold all the way back to a close near $4,157. When a bullish catalyst fails to hold, the sellers are in control. This morning gold bounced toward $4,192 on the open, then faded back after ISM data hit the wires.

Levels I'm watching

Today's calendar

8:30 AM ET: September nonfarm payrolls (forecast ~98K, prior 162K); unemployment rate (forecast 4.1%); average hourly earnings m/m (forecast 0.3%)

10:00 AM ET: Factory orders m/m (forecast -0.1%, prior 0.9%)

Fed speakers: Dallas Fed President Lorie Logan and NY Fed President John Williams both have public appearances, times not specified

The read

Price is trading under all three major moving averages with momentum soft but not oversold, which means there is room for NFP to decide the day. A hot payrolls print revives October hike bets and keeps the pressure on toward $4,138 and below. A weak print takes the hike off the table and could finally let that central bank bid show up. I am flat into the number and waiting for the reaction, not the number itself.

Not financial advice. Educational commentary only. You make your own trading decisions.

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