From TradingView · · 2m
Gold Market Weekly Review: Pending Head-and-Shoulders Pattern
Gold's bearish pattern faces NFP report shock as traders brace for short-term dip.
In brief
Gold's bearish pattern faces NFP report shock as traders brace for short-term dip. Gold prices dropped $60 after U.S. Non-Farm Payrolls report showed 165,000 new jobs and 4.1% unemployment, shifting market focus from safe-haven demand to higher interest rates. Originally reported by TradingView.
Gold Market Weekly Review
This week’s gold market played out like a meticulously choreographed drama: the first half featured a spirited counterattack by the bulls, while the second half turned into a solo performance by the bears.
Technical Pattern Analysis
Gold formed an inverse head and shoulders structure with the left shoulder in 3972, 3988, head near 3875, and right shoulder retracing into 4030, 4080.
Right Shoulder Weakness
The rebound of the right shoulder failed to break through the downward trend line and reversed below 4212, 4233 bull-bear boundary zone.
Non-Farm Payrolls Report
U.S. Non-Farm Payrolls report for October showed 165,000 new jobs added, unemployment rate at 4.1%, and U.S. Dollar Index surged 0.74%.
Market Reaction
Spot gold plummeted nearly $60 from intraday high to touch 4,029 after NFP report, shattering bullish expectations.
Fed Rate Hike Probability
The NFP report sent probability of December Fed rate hike from 67% to 80%, with San Francisco Fed President Daly stating, 'My expectation is that we will have to tighten policy further.'
“My expectation is that we will have to tighten policy further.”
Short-Term Outlook
Expect bearish consolidation as gold falls below short-term moving averages with MACD momentum bars contracting.
Key Support Level
Price needs to reclaim 4,080, 4,100 level to avoid testing 3,972, 3,988 secondary platform decline zone.
Central Bank Buying
People's Bank of China added 830,000 ounces in October, the largest monthly increase since resuming gold purchases.
Medium-Term Risk
Real risk is Fed rate hike in December coupled with dot plot signaling action into 2027, potentially dropping gold below 3,900.
Trading Strategy
If gold rebounds toward 4,120, 4,150, take profit on short positions; if drops to 3,970, 3,988 with stabilization, scale into long positions.
Market Reality Check
The NFP report shattered half of bulls' illusions; whether the remaining half survives depends on next week’s CPI data and Fed commentary.
The one thing
Gold prices dropped $60 after U.S. Non-Farm Payrolls report showed 165,000 new jobs and 4.1% unemployment, shifting market focus from safe-haven demand to higher interest rates.
