Gold Surges Nearly 5% Weekly to $4,324.6 as US Jobs Data Reshapes Rate Outlook

• Gold traded around $4,325 on Monday (August 10) after posting a weekly gain of approximately 4.8% – its best performance since late January.

• The July nonfarm payrolls report unexpectedly showed a net loss of 23,000 jobs, slashing expectations for a September Fed rate hike.

• A weaker dollar and lower Treasury yields provided a powerful tailwind for the precious metal, with XAU/USD briefly testing $4,370.

• Traders now look ahead to US CPI data later this week for confirmation of the disinflation trend.

Gold Holds Above $4,300 After Blockbuster Weekly Rally

Gold prices extended their bullish run on Monday, August 10, with spot XAU/USD trading in a narrow range around $4,324–$4,335 during the Asian session. The metal surged more than 4.8% over the previous week, marking its strongest weekly advance since January. At one point on Friday, gold spiked to an intraday high of $4,371.53 before settling at $4,341.12 – a daily gain of 2.37%.

US gold futures followed suit, closing the week at $4,401.3 per ounce, up $291.60 (7.20%) on the week. Silver also rallied, with spot silver rising 3.27% on Friday to $63.51.

NFP Shocker: Negative Jobs Growth Crushes Hawkish Bets

The primary catalyst for gold’s explosive move was Friday’s US July nonfarm payrolls report, which delivered a major downside surprise. Instead of the expected +80,000 jobs, the economy lost 23,000 positions – the first negative print since December 2024. Moreover, the June figure was revised sharply lower to just +20,000.

Although the unemployment rate dipped to 4.1% (from 4.2%), that was largely due to a decline in labour force participation. The underlying weakness was undeniable.

In response, Fed rate-hike odds for September plummeted from 57% to roughly 44% , while the probability of a pause jumped to 56%. The US dollar index fell 0.36% to 99.59, its second consecutive weekly loss. The 2‑year Treasury yield dropped 4.2 basis points to 4.245%, and the 10‑year yield slipped to 4.649%.

Three Drivers Behind Gold’s Breakout

1. Fed Expectations Reset – The weak jobs report fuelled speculation that the Federal Reserve may have already reached its terminal rate. With labour market cracks appearing, the central bank is now widely expected to hold rates steady in September, removing a major headwind for gold.

2. Dollar and Yield Tailwinds – A softer dollar makes dollar‑denominated bullion cheaper for foreign buyers, while lower bond yields reduce the opportunity cost of holding non‑yielding gold. The combination proved highly supportive.

3. Short Covering and FOMO – After consolidating near $4,000 for weeks, gold’s rapid move above key resistance forced short sellers to cover and attracted momentum‑chasing buyers, amplifying the rally.

Technical Outlook: Overbought but Trend Intact

From a technical standpoint, gold has broken decisively above its 50‑day moving average (near $4,160) and is now trading well above both the 20‑period and 100‑period moving averages on the 4‑hour chart.

• Immediate resistance lies around $4,370** (Friday’s high). A clean break could open the door to **$4,400 and possibly the psychological $4,500 level.

• Initial support is seen near $4,310–$4,320, followed by $4,250. A deeper pullback might retest the breakout zone around $4,200.

The 4‑hour RSI is hovering near 72, indicating overbought conditions. While this does not guarantee a reversal, it suggests that profit‑taking could emerge if the dollar rebounds or if upcoming data disappoints bulls.

What to Watch This Week: US CPI Takes Centre Stage

With the NFP out of the way, traders now turn to US Consumer Price Index (CPI) data due later this week. If inflation shows further signs of cooling, it would reinforce the view that the Fed is done tightening, potentially fuelling another leg higher for gold.

Conversely, a sticky inflation reading could prompt some hawkish repricing, capping gold’s upside in the short term.

Institutional views remain bullish. CITIC Securities sees $4,000 as a solid floor and expects gold to resume its uptrend within the year. UBS is even more optimistic, projecting prices to reach $5,000 by the first half of 2027. Meanwhile, central bank buying continues to underpin the market – the People's Bank of China added to its reserves for the 21st consecutive month, with total holdings reaching 76.08 million troy ounces at end‑July.

Trading Strategies for the Week Ahead

• Watch the $4,370 resistance: A decisive break above could trigger a move toward $4,400–$4,450. Failure to clear may lead to a pullback toward $4,310.

• Monitor overbought signals: If the dollar bounces or yields stabilise, gold could see short‑term profit‑taking.

• Stay nimble before CPI: Volatility is likely to pick up ahead of the inflation release. Adjust position sizes accordingly.

• Manage risk: Use stop‑loss orders and avoid over‑leverage, especially given the recent rapid move.