$XAU ‌

July 2–3 delivered one of gold's strongest weekly performances in over a month.

Spot gold surged 2.28% on July 2 to $4,123.80, then extended gains to $4,179.94 on July 3, up another 1.4% on the day. August gold futures climbed to $4,193.20, putting gold on track for its first weekly gain in five weeks (+2.3%).

The rally was driven primarily by a weaker-than-expected June U.S. Non-Farm Payrolls (NFP) report, which reshaped expectations for Federal Reserve policy.

Market Reaction

• Spot Gold (July 2): $4,123.80 (+2.28%)
• Spot Gold (July 3): $4,179.94 (+1.4%)
• August Gold Futures: $4,193.20
• Weekly Gold Gain: +2.3%
• June NFP: 57,000 jobs added
• Unemployment Rate: 4.2% (vs. 4.3% previously)
• 10-Year Treasury Yield: 4.465%
• U.S. Dollar Index (DXY): 100.85 (-0.55%)

The weak payrolls report significantly reduced expectations for additional Fed rate hikes, supporting both gold prices and broader safe-haven demand.

Why Gold Moved Higher

1. Weak Labor Market Data

The U.S. economy added only 57,000 jobs in June, well below market expectations.

Although the unemployment rate declined to 4.2%, the improvement was largely attributed to lower labor-force participation rather than stronger hiring.

2. Fed Expectations Shifted

The weaker employment data led markets to reduce expectations for future Federal Reserve tightening.

Lower rate expectations reduced the opportunity cost of holding non-yielding assets like gold while simultaneously weakening the U.S. dollar.

OANDA Senior Market Analyst Kelvin Wong summarized the move:

«"What we're seeing is a reduction in the pricing of U.S. Federal Reserve rate hikes for the rest of this year, as well as Q1 next year, primarily driven by a rather lackluster U.S. labor market data."»

3. Technical Momentum Improved

Gold reclaimed the $4,100 level, strengthening bullish momentum and shifting attention toward higher resistance levels.

Key Technical Levels

Resistance

• $4,162.36–$4,214.34
• $4,382.62
• $4,411.94

Support

• $4,100
• $4,032
• $4,000

Holding above $4,100 keeps the current bullish structure intact, while a break below could trigger a retest of lower support.

Macro Outlook

Earlier in late June, Citi reduced its three-month gold target from $4,300 to $4,000, citing stronger real yields, a firmer U.S. dollar, moderating ETF demand, and easing geopolitical risks.

However, the latest NFP report has already challenged part of that outlook.

A weaker dollar, declining Treasury yields, and continued central bank gold purchases remain supportive for the precious metal, while geopolitical uncertainty—including the U.S.-Iran conflict—continues to reinforce safe-haven demand.

Trading Takeaway

The latest NFP report has shifted market sentiment from a more hawkish Fed outlook toward a less aggressive policy path.

For TradFi CFD traders, the current environment favors bullish momentum while the dollar remains under pressure and rate-hike expectations continue to ease.

What to Watch

• U.S. CPI inflation data
• Upcoming Fed communications
• Treasury yield direction
• DXY performance
• Gold support at $4,100 and $4,000
• Resistance at $4,162–$4,214

Positioning

• Monitor incoming macroeconomic data before increasing exposure.
• Respect the key technical support and resistance levels.
• Maintain disciplined risk management, as stronger inflation data could quickly revive hawkish Fed expectations.

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