XAU / USD remains depressed near multi-month lows following NFP figures

• The sustained purchase of the USD put some pressure on gold during the early days of the American session.
• NFP’s strong report provided an additional boost to the dollar and US Treasury yields.
• A softer risk tone extended some support to the XAU / USD safe haven and helped limit losses.

The oro it advanced lower during the early days of the US session and fell to fresh nine-month lows below $ 1,690 in reaction to an upbeat US employment report.

Figures from the NFP showed that the US economy added 37,000 new jobs in February, beating consensus estimates by a large margin. In addition to this, the previous month’s reading was also revised upwards to 166,000 from 49,000 previously reported and the unemployment rate dropped to 6.2% from 6.3% previously.

The upbeat data provided an additional boost to the already stronger US dollar and led to some selling around the dollar-denominated commodity. The USD was supported by a new momentum in US Treasury yields, which tends to push away the inflows of the underperforming yellow metal.

That said, a sharp pullback in US equity futures extended some support to the XAU / USD safe haven and helped limit any further losses. Investors also seemed reluctant to place further bearish bets amid oversold conditions on short-term charts, justifying some caution for bearish traders.

Nonetheless, the XAU / USD remains on track for the third consecutive week of losses and is vulnerable to further decline. Therefore, any recovery attempt could be seen as a selling opportunity amid the progress of US President Joe Biden’s $ 1.9 trillion stimulus package.

Technical levels