After the release of the U.S. August employment data on Friday, the market expects the Federal Reserve to end its tightening cycle. Gold has steadily risen from multi-month lows in August, with December gold futures reaching a three-week high.  

The combined effects of OPEC+ production cuts and China’s strong economic support have driven oil prices up by nearly 3%. 

Gold >>

Gold prices steadily rebounded from multi-month lows in August, with December gold futures reaching a three-week high. After the release of the U.S. nonfarm payrolls report on Friday, gold briefly touched $1,980.20.  

While the upward momentum in gold has cooled slightly, December gold futures closed 1.18% higher than the previous Friday, ultimately settling near $1,985. 

Despite the economy creating more jobs than economists expected, wage growth fell short of expectations, and the unemployment rate surged.  

Currently, the market expects the Federal Reserve to maintain interest rates in September, with a 60% probability of a rate hike in November. Investors are closely watching upcoming U.S. data releases. 

After a high and subsequent pullback following last Friday’s nonfarm payrolls report, a small doji star pattern appeared on the daily chart for gold.  

Gold showed a minor reaction to the nonfarm data in the evening, failing to produce significant breakthroughs, and reached a high of $1,953 in the context of a favorable unemployment rate for gold. 

Technical Analysis: 

Today’s gold trading strategy suggests focusing on short positions during rebounds, with long positions considered on dips. 

• Key resistance levels to watch in the short term are around 1948-1953. 
• Key support levels to watch in the short term are around 1928-1923. 

WTI Crude Oil >> 

On Friday, international oil prices surged by nearly 3%, with U.S. oil surpassing the $85 per barrel mark and Brent oil reaching above $88 per barrel.  

The U.S. job market slowdown, coupled with a cooling of expectations for Fed rate hikes, has raised the possibility of a ‘soft landing’ for the U.S. economy. This optimism spilled over into the overnight U.S. stock market, boosting confidence among oil bulls. 

Furthermore, the latest release of China’s August manufacturing PMI data slightly exceeded market expectations, alleviating concerns about demand.  

Combined with a series of U.S. data releases last Monday that weighed on the U.S. dollar, investors are reconsidering whether the Fed needs to raise rates again, with the focus this week shifting to the ISM non-manufacturing PMI. 

Given the continued decline in oil inventories, the consensus on oil prices may appear somewhat conservative. The global oil market remains tight, with an estimated reduction of 2.8 million barrels per day in global inventories in August, and an expected further decrease of 2.4 million barrels per day next month. 

OPEC+’s efforts to reduce supply in recent months have dominated the spot market, while China has shown determination to boost its economy, driving oil prices higher, as China is a key engine of global crude oil consumption. 

Technical Analysis: 

Today’s short-term trading strategy suggests a focus on short positions during rebounds, with long positions considered as a secondary option during price dips. 

• Key resistance levels to monitor in the short term are around 86.5-87.0. 
• Key support levels to monitor in the short term are around 83.5-83.0. 

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