Zong Xiaoli: The non-farm payrolls report officially releases tonight. How will the USD and gold react?

Recently, more and more people are expressing their confusion about the market — despite the intense situation in the Middle East, with frequent clashes between Dazhuo, YSL, and Lang Lang, creating a lively scene, this is a typical case of geopolitical factors stimulating the market. It is clearly favorable to gold, but the market performance has been disappointing. Instead of rising as expected, it has been gradually declining, leaving many puzzled…

The main reason is that the market focus has shifted. On one hand, the Middle East situation has become tense, and the market has gradually adapted to this rhythm. On the other hand, gold prices are too high, with a large bubble and a need for a correction. Additionally, the market’s funding gap is widening, so a decline in gold prices has become a natural outcome. This is completely different from the previous geopolitical logic, resulting in a different trend. Gold prices are inching down, and the geopolitical factors have little impact. The more intense the geopolitical situation, the more gold prices tend to fall… Regarding this situation, will there be any change after tonight’s non-farm payroll data is released? Cautiously, I believe, if gold cannot even break through 5140, how can there be any talk of an upward move?

As for the US dollar index, from a technical perspective, there is significant resistance because it has formed upper shadows for three consecutive days. Isn’t this a classic three-needle top pattern? Interestingly, the dollar is not showing any downward intention; instead, it is actively pushing upward. This has puzzled many people—does the dollar index still have room to rise? Indeed, the dollar index aims to go higher because only rising can protect the fundamentals and prevent liquidity from flowing out. Especially after tonight’s non-farm payroll data, the impact on the dollar index will be substantial. Everyone should be cautious of a sudden surge after fluctuations. Therefore, low-positioned long trades are the right approach for now. Just for your reference!