Gold drops to fresh multi-day lows on upbeat NFP report
- Stellar US employment details provided a strong boost to the USD.
- Surging US bond yields exerted some additional pressure on gold.
- The downside seems cushioned amid persistent trade uncertainties.
Gold faded an intraday bullish spike to the $1480 area and tumbled to fresh multi-day lows, around the $1465 region in reaction to upbeat US monthly jobs report.
The latest US employment details showed that the US economy added 266K jobs in November, surpassing even the most optimistic estimates. Adding to this, the previous month's reading was also revised higher to 156K from 128K reported earlier.
Tumbles on the back of stellar NFP print
Apart from stellar headline NFP print, the unemployment rate unexpectedly dipped to 3.5%. Meanwhile, average hourly earnings growth came in slightly weaker, at 0.2%, albeit was largely offset by an upward revision of the previous month's reading.
The data provided a goodish intraday lift to the US dollar and prompted some aggressive selling around the dollar-denominated commodity. This coupled with a sudden upsurge in the US Treasury bond yields also played its part in driving flows away from the non-yielding yellow metal.
Barring the knee-jerk fall, the downside remained cushioned amid persistent uncertainty surrounding a potential US-China trade deal. Hence, it will now be interesting to see if the metal is able to find any support at lower levels or continues with its rejection slide from the vicinity of 100-day SMA.
Technical levels to watch