Although the dollar began to gain strength against its peers ahead of the US session, the XAU / EUR rise held up precious metal demand, helping the XAU / USD pair keep their daily gains.
However, the sustained bullish momentum of the US dollar index and positive market sentiment forced buyers to rise further. In fact, the DXY is now at 93.80, rising 0.53% on the day. In addition, the Dow Jones Industrial Average and S & P 500 are on the way to another record daily close to maximum, and adding 0.4% and 0.45%, respectively.
Earlier in the session, optimistic data from the US fueled the rise seen in the DXY with weekly jobless claims and the trade balance both coming in better than market expectations. Moreover, the observations of members of the FOMC monetary policy on Thursday boosted the chances of a rate hike from the Fed in December, giving an additional rate rise.
However, the pair seems to have entered a phase of consolidation in the last hour as the volume of trade begins to slacken before the critical US NFP report tomorrow. Although markets expect growth payroll of 156K 90K in September, it will probably be ignored by participants, as are deemed to reflect the negative impact of Irma and Harvey hurricanes. "The negative impact on the labor market should be short-lived, as we have already seen that initial jobless claims are starting to decline again, but we do not expect a decline in the unemployment rate (although the risk is probably biased towards an increase), "say analysts at Danske Bank.
Technical perspective
On the negative side, $ 1262 (DMA of 200) remains a critical support. A decisive push below that level could open the door to $ 1251 (8 August low) and $ 1243 (July 26 low). On the positive side, the resistors are aligned on $ 1282 (maximum of 4 October), $ 1295 (DMA 20) and $ 1300 (psychological). With today's setback, the CCI indicator on the daily chart declined to -100, suggesting that the bearish momentum is building up in the short term.
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