Gold traders need to be nimble in the current market conditions. According to some analysts, the precious metal is sensitive to positive economic data, as well as to the comments of the Federal Reserve System, which indicate a possible reduction in monthly asset purchases.
The precious metal found some support at the start of the US session yesterday after ADP said that only 330,000 jobs were created in July. Economists had expected an increase of 695,000 in the number of jobs.
A little later, gold came under some pressure from sellers, after the data from the Institute for Supply Management (ISM) turned out to be better than expected. The non-manufacturing purchasing managers' index hit a record 64.1% last month, up from 60.1% in June. The data turned out to be better than expected.
The gold market took another hit after Federal Reserve Vice Chair Richard Clarida said he supported a rise in interest rates in 2023. And that by the end of 2022, the conditions for raising the target range of the federal funds rate will be met.
Analysts at Commerzbank said they are neutral to gold in the short term but remain optimistic about the long term. They added that the inability of gold to keep its profits is worrisome.
ADP data indicated some risk of worsening in the official nonfarm payrolls report on Friday, but many economists noted that the private sector report was not a consistent predictor of government performance.
