Friday’s Jobs Will Be Huge For Gold: Market Strategist

Should Friday’s non-farm payroll miss expectations, it could be the break gold is waiting for, said one senior market strategist. “It is going to be huge,” said Bill Baruch, senior strategist at Chicago-based iiTrader, in regards to the potential impact on gold. “Our line in the sand is 200,000 jobs created, the expectation is 223,000 –- so you want to see a better number than that for the dollar to excel. If we miss that, look for gold to get out above $1,100 an ounce and hit the $1,300 area as shorts look to start covering,” he told Kitco News. On Tuesday, gold was recovering from an overnight low of $1080.20 -- Kitco’s spot gold price showed the metal up $5.00 and trading at $1091.10 an ounce. Baruch added that present economic data was not helping the yellow metal’s case, including Friday’s dire wage growth data. The metal has not been able to achieve a close above $1,100 an ounce since July 21. “The U.S. is still the best house on a bad block. The dollar is still remaining strong despite weak economic data, not helping gold’s case,” said Baruch. He added that expectations remain for a U.S. Fed rate hike in September. “For Gold it is not a matter of when exactly the rate hike will be, it is simply the fact that we are approaching normalization at some point in the near future. That can help explain why Gold has not been able to hold rallies upon poor economic data,” he said. Baruch highlighted that every single gold rally has been subdued, indicating the sellers are there and have priced in a rate hike. “If you are holding big positions you have to plan six, nine and even 18 months out and that’s what these guys are looking at,” he explained.