Gold losing $13 in an hour

Gold Reversing Lower on Higher US JOLTS Jobs Openings Figures

Posted Tuesday, November 1, 2022 by
Skerdian Meta • 2 min read

Gold has been on a bearish trend overall as the USD remains bid, with the FED being on a very steep tightening path. Although, expectations are that the FED will slow down with rate hikes soon, probably after the 75 bps rate hike which is planned for tomorrow. That’s one of the reasons that the USD has been showing signs of weakness recently, while Gold has been retracing higher.

Today we saw some bullish momentum in the European session as risk sentiment improved in financial markets, but moving averages turned into resistance and stopped the climb. On the H1 chart above, the 100 SMA (green) provided resistance and the price reversed lower, after being overbought, with the stochastic indicator indicating a bearish reversal.

Gold H4 Chart – The 100 SMA Acting As Resistance

MAs keeping Gold bearish

On the H4 chart, we see that the 100 SMA has turned into resistance here as well, and Gold is facing the 50 SMA (yellow) at the bottom now. The main reason for the reversal was the JOLTS job openings in the US.Coming off the August JOLTs report which showed a record decline of 1 million job openings, the hope was September would at least keep that trend in play.

JOLTs Job Openings for September 2022

Jolts job openings remain near record levels
  • JOLT job openings for September 10.717M vs 10.000M estimate
  • Prior month 10.053M vs 10.775M est. The decline last month was the largest one month drop on record. The prior month was revised up to 10.280M
  • JOLTs job openings higher than expectations at 10.717M vs. 10.000M
  • Job openings were up 6.5% month on month. It was down -0.8% vs. It’s a peak in March 2022
  • Largest increases came in accommodation and food services at +215,000. Healthcare and social assistance rose by 115,000 and transportation warehousing and utilities increased by 111,000.
  • Decreases came in wholesale trade at -104,000 and in finance and insurance -83,000
  • Hires edged down 6.1 million
  • Total separations came in at 5.7 million down 370,000 on the month or -3.7%
  • Quits came in little changed at 4.1 million. The quits rate is thought to be a barometer for the strength of the labor market as a quit because they tend to have another job lined up. The quits rate was at 2.7% for the 3rd month in a row signaling steady.
  • Layoffs and discharges edged down to 1.3 million

Overall the JOLTs report is not good news for the FED as they fight inflation. Inflation is not dead and strong employment has the potential to keep inflation elevated for an extended period time. The good news is that the ISM prices paid index fell below the 50 level to 46.6 points. That was well below the expected 52.5 points.

US September 2022 Construction Spending Report

Construction spending

  • September construction spending +0.2% vs -0.5% expected
  • August construction spending was -0.7%
  • Construction spending during September 2022 was estimated at a seasonally adjusted annual rate of $1,811.1 billion, 0.2% above the revised August estimate of $1,807.0 billion
  • Private construction +0.4%
  • Public construction -0.4%

This is an important component in GDP and will lead to upward revisions on Q3 estimates. We already got the advance reading on Q3 last week.

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