This week, gold prices have regained their footing following one of the steepest monthly declines in years. The precious metal lost more than 11% in March—its worst performance since October 2008.
The US President’s willingness to pursue a ceasefire with Iran within the next two to three weeks, along with Federal Reserve (Fed) Chair comments about long-term inflation expectations being under control, set the stage for a rebound in bullion prices. These factors have slightly weakened the dollar, allowing gold to climb back to the $4,550–$4,700 range.
Market attention is now glued to Friday’s US labor market report. Investors predict an increase of 56,000 new jobs, a relatively conservative estimate. If the actual figures exceed that number, skyrocketing to 90,000–100,000, traders could lose hope for any Fed rate cuts this year. Such a scenario would, in turn, modestly strengthen the greenback and weigh on the entire complex of precious metals.
Turning to the technical setup, a clear bearish story is visible on the chart. Prices have just breached an ascending support line from top to bottom. If the downtrend continues to develop, the metal’s nearest target could be $4,400 per troy ounce.
The final recommendation:
— Sell gold at the current price, aiming for $4,400 within a day or two;
— Place Stop Loss 1% above the entry point to manage risks if the market plays against us.
