Gold posts rare winning session, ahead of Friday’s U.S. jobs report

Investing.com — rose considerably posting a rare winning session, as investors anticipate muted job gains for the month of July when the U.S. Department of Labor releases its employment situation report on Friday morning.

On the Comex division of the New York Mercantile Exchange, gold for December delivery traded in a range between $1,082.70 and $1,092.70 in Thursday's session before settling near the session highs at $1,092.20 at the close. Gold has still closed lower in seven of the last nine sessions as it has hovered near five and a half year lows. It was preceded by a 10-day losing skid, its longest in nearly two decades, fueled by concerns in the Chinese equities markets, an increasing possibility of an interest rate hike by the Federal Reserve and its dampening appeal as a safe haven asset. Gold futures are still down by more than 6.5% from their level of $1,175 an ounce over the last month.

Gold likely gained support at $1,083.50, the low from July 20 and was met with resistance at $1,103, the high from July 31.

Investors await the release of Friday's job report by the Labor Department's Bureau of Labor Statistics for further indications on the timing of the Federal Reserve's first interest rate hike since 2006. On Wednesday, Fed governor Jerome Powell said it is not a certainty that the Federal Open Market Committee will raise rates during its September meeting, as many investors anticipate. Powell added that he will take a data-driven approach to the decision on whether to normalize monetary policy, placing particular emphasis on the strength of the labor market.

Gold, which is not attached to interest rates or dividends, struggles to compete with high-yield bearing assets in rising rate environments.

Also on Wednesday, staffers from the research institute ADP said in its monthly national employment report that private payrolls in the U.S. rose by 185,000 in July, below forecasts of a 210,000 gain and down from an increase of 237,000 a month earlier. For the month of July, analysts are predicting a consensus increase of 212,000 non-farm jobs, below the robust gains in June when non-farm payrolls rose by 223,000. Economists also expect the unemployment rate to remain in a consensus range between 5.2 and 5.4%, after falling 0.2% to 5.3% in June.

The , which measures the strength of the greenback against a basket of six other major currencies, fell 0.10% to 97.88 in U.S. afternoon trading. One session earlier, the index surged to an intraday high of 98.33 – its highest level since April 23.

Dollar-denominated commodities such as gold become more expensive for foreign purchasers when the dollar appreciates.

Silver for September delivery jumped 0.152 or 1.04% to 14.705 an ounce.

for September delivery fell 0.005 or 0.22% to 2.343 a pound.

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